The Executive is considering increasing taxes on cigarettes and alcoholic beverages as an option for balancing the 2015 budget.
With the provisional suspension of the tax on telephone lines the Guatemalan government is left with a deficit $237 million, approximately, which is why it is looking at bridging the gap using new taxes on liquor and cigarettes, as the main alternative.
The member countries of the Framework Convention for the Control of Tobacco have approved raising taxes on the tobacco industry.
This new document seeks to "... strengthen measures relating to applicable taxes and prices in order to reduce consumption and the number of deaths from consumption of tobacco, as it is closely related to the cost of the product."
Tobacco leaf producers will still export to Europe and America, while the industry will decline at the same pace as the contraction of the domestic market.
Elperiodico.com.gt reports on Deloitte's study presented by British American Tobacco (BAT), which notes that "in 2011 there were 15.7 million kilos of tobacco leaf for export, which generated $52.8 million in foreign exchange according to statistics from the Bank of Guatemala (Banguat).
Arguing that smuggled cigarettes account for up to 60% of consumption in Central America and because of excessive export regulations, the tobacco company has ceased its operations after 50 years of being in the country.
Tabacalera Centroamericana S.A. (Tacasa) closed its plant in Boca del Monte, where for 50 years it has produced cigarette brands like Marlboro Rubios y L&M.
The Pan American Health Organization denounced the continued interference by the tobacco industry in the passing of antismoking laws in the countries of the Americas.
Washington, D.C., 31 May 2012 (PAHO/WHO) - The tobacco industry continues to interfere with tobacco control policies in the Americas and these efforts have intensified since the 2005 entry into force of the WHO Framework Convention on Tobacco Control.
The new proposal would establish a tax of $0.09 (Q0, 69) per gram.
The initiative is supported by the Ministry of Health and organizations against the use of tabaco.
“If the proposal is accepted we would be able to raise about $66 million a year”, said the congresswoman Zury Rios.
"The new estimate is higher than the target proposed by the Superintendency of Tax Administration (SAT), a government initiative to raise Q356 million ($ 46.8 million) a year on restoration of the tax." states an article in Prensalibre.com
After a decision by the Constitutional Court, the tobacco company announced its willingness to dialogue.
The decision of the Constitutional Court in favor of an appeal by British American Tobacco, which alleged double taxation, will negatively impact tax revenues.
Sofia Oliva, manager of corporate affairs of the company, told Prensa Libre, "After being notified of the decision, we initiated contact with the government authorities to find long term solutions."
We sell premium cigars: Flor Real, Bahias, Sueños Oro, Chieftains,
Organization that operates in Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama
Phone: (506) 2232 9491 - (506) 8864 0189
We manufacture five original brands of premium cigars, tobacco for pipe and BlackJack flavors cigars.
Organization that operates in Guatemala
Phone: (502) 5206 9066
Oettinger Davidoff bought the Honduran premium cigar company call Camacho Cigars. With this acquisition it now has 10 brands in its commercial portfolio in the Caribbean.
The factory, headquartered in Danli, El Paraiso, some 150 kilometers east of Tegucigalpa, had become a key player in the US market where it had an office in Miami named Caribe Imported Cigars, which competed in the cigarette and cigar market.
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