Wednesday, 4 April 2012

Is this the start of the abolition of Duty Free tobacco?

With fast approaching nearly 200 countries signing up the Framework Convention on Tobacco Control (W.T.O.) one of the objectives to prohibit or restrict Duty Free tobacco sales. The underlying rationale of this is that people will instead have to purchase tobacco on the domestic market at the taxed price. As a result it is not difficult to image the hundreds of millions if not billions this would generate into the various government treasuries thus achieving the twin objectives of reducing tobacco consumption and raising revenue.



The Tobacco Industry and Duty Free operators have all traditionally countered that this type of operation is tightly controlled (i.e. under Governments agencies) and the total amount of duty free represents such a very small percentage of overall sales compared to the domestic market. It is difficult to argue though as why the Tobacco industry lavishes such huge amounts of money on promotions, advertising, etc for such meagre returns – unless Duty Free represents massive “shop window” advertising opportunity for the industry.





So, with the reductions in tobacco consumption, many public places, offices, bars and restaurants barring smoking it would seem the abolition of tobacco in Duty Free is inevitable..... so what is stopping it?

While there are nearly 200 nations across the globe supporting this cause in principal the “collectiveness” for the cause is pulled apart by social, economic and political differences whereby very few of the countries actually function at the same speed of thought and action. Inevitably, this will prolong the final outcome.... but will it happen and when?

No comments: