On June 4, an important vote was held – one of those that journalists analyze by name. We are talking about raising taxes on tobacco products.
Draft law No. 11090, initiated by the Ministry of Finance and supported by the Tax Committee of Danylo Hetmantsev, has already been recommended for parliamentary consideration. Journalist Natalia Sokolenko writes on Ukrainska Pravda.
The tobacco industry uses money, lies and manipulation to achieve the desired solution – the smallest possible change in taxation. All for the sake of persuading the deputies to make the right decision. The level of penetration of tobacco companies in the Verkhovna Rada is impressive. For example, the late traitor MP Oleksiy Kovalev’s official assistant was Valentyna Khomenko, the head of the Ukrtiutiun corporation. And the MP of the “Servant of the People” faction Prior to becoming a parliamentarian, Marian Zablotskyi worked for the Ukrainian Society for Economic Freedoms, a non-governmental organization that received $427,000 (!) from Philip Morris between 2017 and 2019. He is now a member of the Committee on Finance, Taxation and Customs Policy and quietly lobbies for tobacco companies, even on the record.
But it seems that on the eve of the vote to raise excise taxes, something went wrong and the tobacco industry released a certain “public opinion leader”, Anatoliy Amelin, executive director of the Ukrainian Institute for the Future, on the Trukha TV channel. Personally, I had a conflict with this NGO, and it happened when the “expert” of the Ukrainian Institute for the Future, Tetiana Yushchenko (Ogneviyuk), apparently on the instructions of her superiors, opposed the creation of the High Anti-Corruption Court of Ukraine – HACC. The arguments were that this was an institution for the resignation of third world countries, not for Ukraine. The “expert” went on TV, writing these theses everywhere. But on the night before the vote on the HACC bill, the “expert” changed her mind and wrote an article saying that we should vote for the law on the creation of the HACC. It’s about expertise.
On the eve of the vote on the draft law on new excise tax rates on tobacco products, the Trukha TV channel suddenly quoted an article by Mr. Amelin, in which he showed his “expertise” in the taxation of tobacco products and also acted as a public health expert, both of which have nothing to do with expertise.
“If this draft law is adopted, Ukraine will receive the European standard of the minimum excise tax on cigarettes – 90 euros per 1000 pieces by 2028. The excise tax on HTPs will be 20% lower, which, on the one hand, will be in line with EU approaches, and on the other hand, will stimulate the consumption of HTPs, which are free of counterfeits and less harmful to the body, as well as guaranteed budget revenues,” says Anatoliy Amelin, executive director of the Ukrainian Institute for the Future think tank, in a news story on the above-mentioned TG channel.
Mistake of “expert” Amelin N1:
Starting in 2021, Ukraine will have the same tax rate for regular cigarettes and electrically heated tobacco products (EHTs). When the decision to raise the rate for regular cigarettes came into effect, in the first year alone, budget revenues from the HTPs increased 6 (!) times. And this success has been maintained over the years – taxes are collected without any problems, despite gloomy predictions that smuggling and counterfeiting would appear due to the rise in the price of the HTPs. The deputies themselves write that 99% of the HTPs are legal! The question is: who would benefit from making the tax rate on HTPs lower than on cigarettes? The answer is obvious – only to tobacco users! If the single rate is terminated and the tax on HTPs is reduced, the Ukrainian budget will not receive UAH 15 billion in 2025-2028 and at least UAH 5 billion for each subsequent year.
This is Amelin’s dirty game in favor of a certain taxpayer, Philip Morris. This company is a direct beneficiary of the decoupling of the tax rate on cigarettes and HTPs and the reduction of the excise tax for HTPs. Philip Morris’ so-called “icos” in Ukraine occupy 80% of the market for devices for electric heating of tobacco. This is a game in favor of a company that has not left Russia and is currently one of the largest taxpayers in Russia. I think it is unnecessary to remind you that this money is used to kill Ukrainians and Ukraine. That is why the NACP added Philip Morris to the register of international war sponsors.
Mistake of the “expert” Amelin N2:
Amelin writes as a good thing that a lower tax rate on CFLs will stimulate consumption of CFLs as if they were not harmful to health. Since when did a lawyer become a public health specialist?
The World Health Organization (WHO) and the Ministry of Health of Ukraine consider HTPs to be as bad for Ukrainians as cigarettes. This information is available on the official website of the Ministry of Health.
“Heating tobacco products are tobacco products, and all the provisions of the WHO Framework Convention on Tobacco Control (FCTC) that apply to traditional tobacco products also apply to heating tobacco products, including taxation ,” said Dr. Jarno Habicht, Head of the WHO Country Office in Ukraine.
MPs have two reasonable options. First. To support the government’s draft law N10090 with an amendment stating that the tax on cigarettes and fuel cells is not separated and will continue to be increased simultaneously. Second. Vote for the draft law N10090-3, which also provides for the preservation of the same tax rate on cigarettes and HTPs, developed by MP Lada Bulakh of the Servant of the People faction, who is also a public health specialist.
I know that MPs are now being accused of various lies, such as if HTPs become more expensive, people will switch to cheap cigarettes, etc. This is a lie. In fact, price increases and only price increases lead to massive smoking cessation. At the same time, the budget does not suffer losses due to the increase in excise taxes, but rather revenues increase.
This should be the goal of MPs and the government: to increase the life expectancy of Ukrainians and increase budget revenues.
Amelin either does not understand these issues or is deliberately lying. And as we can see from the reports of the Institute of the Future, it is quite likely that it can do this with the money of tobacco companies.
Check it out: The NGO headed by Mr. Amelin gladly accepts money from Philip Morris – it is the largest “benefactor” of the Ukrainian Institute for the Future in 2019!
By the way, isn’t it a conflict of interest for the head of the Ukrainian Institute of the Future to lobby for the interests of a sponsor?