From: CRE Brazil
Three months into the presidential election, the main political debate in Paraguay revolves around a bill to increase cigarette taxes and trace the product from its manufacturing to its destination in order to combat smuggling. According to local analysts, the proposal is likely to be approved by Congress, but rejected by President Horacio Cartes, who owns the country’s largest tobacco company.
Senator Desiree Graciela Mais Jara, author of the initiative that raises the tax from 16% to 30%, says that cigarette smuggling is linked to money laundering and drug dealer financing. “With the current law, we know who the first person is to buy from the producer, but not what happens next,” she explains. The government is against the new regulation under the argument that the tobacco sector is the largest employer in the country.
