Nicosia, Cyprus. Kiosk owners in Cyprus warned on Monday that proposed increases in tobacco taxation could push consumers into illegal channels, weakening legal retail trade and reducing state revenues.
Association warning on market conditions
Speaking to Sigma, kiosks’ association (Sykade) President Andreas Theodoulou said taxation remains a legitimate public health tool, but its impact in Cyprus must be assessed within the island’s specific market conditions.
He said Cyprus has “a peculiarity not found in other EU states,” referring to the Green Line and the ease of access to untaxed products from the north.
Price sensitivity and shift in purchasing
Theodoulou said large tax increases affect not only demand but also where products are purchased, adding that price differences between legal and illegal markets already influence consumer behaviour and further increases could intensify this shift.
“The market shows that tobacco products are extremely sensitive to price changes,” he said.
Estimates of consumption from the north
According to estimates provided by the association, approximately 13 per cent of cigarette consumption and 53 per cent of rolling tobacco consumption already comes from the north.
Theodoulou warned that further tax rises could expand this proportion, calling it “a matter of fiscal loss and market control.”
EU discussions on excise duties
The warning comes amid ongoing EU discussions on revising excise duties for tobacco and nicotine products, including e-cigarettes and heated tobacco products.
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