Higher tobacco taxes could be on the way to Japan

photo by HAMED MASOUMI

One of the reasons for many ex-pats in Japan to take up or continue smoking is their relative low-cost to cigarettes back home.  Currency exchange is one thing but also the fact that the Japanese Government has resisted temptation to whack high taxes on tobacco unlike most other governments throughout the world.

The cost can be as much as 60% cheaper than other developed countries with a box of “Marlboro Lights costing a mere 320 yen, compared with around 600 yen to 800 yen in the European Union.” (Wall Street Journal)

It’s an interesting problem for the new government.  On the one hand they need to rapidly increase funds available for their political reforms and an increase in tax on cigarettes would generate a pool of cash to start with.  But the cigarettes tax issue has been a delicate problem for a while.

Whilst most minsters admit that there is a health problem associated with smoking and an increase in tax would deter some smokers from lighting up and lighten the load on smoke-related health problems and expenditure in hospitals, others would argue that an increase in tax wouldn’t raise that much cash as a sales decrease would negate any possibility of a significant fund raiser and affect current tax revenues on cigarettes.

At the same time, there is a well known relationship between the Japanese Government and Japan Tobacco – Japan’s biggest tobacco company.  The Japanese Government owns about a 50% stake in the business so this would affect any decisions made.

But with the US and many countries in Europe leading the way with smoke-free zones and outdoor bans, it is only a matter of time before the government in Japan is pressured into addressing this burning issue also.

Higher tobacco taxes would be a start.