The GCC states are expected to double customs duty on cigarette and other tobacco imports next month and have sought support from the World Trade Organisation (WTO) for the move, a Saudi-based daily reported yesterday.
A meeting of the finance ministers from six Gulf states scheduled to be held in May will approve the increase, the daily said quoting a senior Saudi official.
According a report published by the Arab News yesterday, the ministers of finance and health from the GCC states have already agreed in principle to raise the levy charged on tobacco imports from 100 to 200 percent.
Qatar is among those GCC states that have imposed 100 per cent tax on tobacco imports. With a new anti-tobacco law in the offing, the country is mulling more stringent measures to reduce the consumption and import of tobacco products.
The new duty will be known as ‘health tax,’ taking into account the huge amount of money each GCC state spends on the treatment of tobacco-related diseases as well as for the rehabilitation of smokers. Majed Al Monief, supervisor of the programme for combating smoking at the Ministry of Health was quoted as saying.The finance ministers will decide when the tax will take effect, he added.
Asked about the move of UAE’s Federal Customs Authority to increase duty on all brands of tobacco products by 100 to 200 percent, Al Monief said that it is impossible for any GCC state to take such a decision unilaterally.
“The GCC states can take a decision in this respect unanimously. The Gulf states had earlier hiked tobacco customs duty from 50 to 100 percent, and are now moving toward making a further hike of 100 percent,” he said adding that the additional revenue will be utilised to combat smoking and reduce its impact on the younger generation.
Al Monief said the GCC general secretariat has sent a formal letter to the World Trade Organization (WTO) requesting it to support the GCC initiative to double the customs tariff on tobacco products. The WTO had earlier rejected a similar request from the GCC states, noting some GCC states had already reached the maximum limit for customs tariffs on tobacco products.
“We are still awaiting a reply from the WTO to go ahead with our plan, in accordance with clause 20 B of the WTO Articles. This provision stipulates that any member country is entitled to take an appropriate decision with regard to any product that is harmful to human beings or animals or the environment,” he said, adding the GCC states will take advantage of this provision while doubling customs tariffs on tobacco products.
The GCC Customs Union Committee earlier sent a proposal to the general secretariat to explore the possibility of increasing customs duty on tobacco products by 100 percent, said the daily.
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