From: Haaretz
Steep tax hikes on alcohol, beer didn’t bring more revenue, just pirating and smuggling. Last week rates were cut and the lesson learned: Excessive tax brings undesirable results.
Meirav Arlosoroff
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The same questions about excessive taxation apply to cigarettes, where a sharp increase caused consumers to start hand-rolling cigarettes, which are more dangerous than packaged brands. As long as the tax on loose tobacco is not increased, nothing is being accomplished by hiking the cigarette tax. On the other hand, there have been no reports of massive smuggling of cigarettes, so at least compared to the taxes on cigarettes abroad, Israel is meeting the test of reasonableness.
