Taxing tobacco in Germany

Anyone who talks to Wolfgang Hainer, the managing director of the Verband der Cigaretten industrie (VdC – Cigarette Industry Association) gets the impression that everything is going well in the world of the tobacco industry.

The lobby has had to deal with a further setback in Germany:  the ban on advertising for tobacco products in newspapers, magazines, on the internet and at national cultural or sporting event is imminent. 

Yet while advertisers, publishers and the brand association are outraged, Hainer first wants to wait for the ruling from the EU court of justice, talking of a lack of clarity in the EU directive and announcing a need for discussion, such as on the question of a timescale for its implementation. 

Hainer’s viewpoint is affirmed by Reemtsma director Richard Gretler, who says that in the event of a ban, “the tobacco industry … would be the most severely affected sector.”

There will also be an intense skirmish surrounding the law proposed by consumer minister Horst Seehofer (CDU), with blows falling all around.  Smoking bans in pubs, bars, restaurants and nightclubs would be likely to have much worse consequences for the tobacco industry if statistics are to be believed.  In the USA for example, this would drastically reduce the number of adult smokers. 

The VdC is able to get involved on this subject, but the main protagonist is the Deutsche Hotel und Gaststättenverband (Dehoga), which wants to prevent a smoking ban.  The fact that Dehoga is accused of working with the VdC represents a serious communication problem for it.

Something to further darken the mood of tobacco companies would be further increases in tobacco taxes.  That has happened five times in the last four years.  Further market collapses as a consequence could hardly come at a worse time for the VdC.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Already registered?
Sign in