Smokers to pay more
THE GLEANER can confirm an earlier report it carried that, as of next week, cigarette smokers will have to pay more to puff away. At the same time, the Government is set to rake in an additional billion dollars above projection from the taxes of cigarettes manufactured by Carreras.
Carreras has formally served notice that it will be increasing the price to both its traditional and new cigarettes manufactured by Carreras Limited.
Effective Monday, a carton of Craven A and Matterhorn brands will be increased from $2,500 to $2,650.
Correspondence to this effect, dated December 5, has been circulated to major customers. "This letter serves to inform you that there will be an increase in the prices of duty-free cigarettes, effective December 17," the correspondence stated.
Managing director of the company Richard Pandohie told The Gleaner last week that the price for its two newest brands - Pall Mall and Turf, has also been increased.
THE REASON FOR THE INCREASE
It is understood that the decision to increase the prices of the cigarettes was precipitated by continuous losses arising from unfair competition through illegally imported brands, while Carreras continues to be heavily taxed by the Government.
"The company has no choice at this time, as it has been losing volumes and profit margins over the last couple of years due to illicit trade," said the source who asked not to be named.
However, Carreras had promised the Government an additional $1 billion in revenues on top of what Carreras pays annually.
"As of today, we are on track, we have paid approximately $700 million more than the corresponding period last year," head of corporate and regulatory affairs at Carreras Christopher Brown told The Gleaner. "The projections are that the additional million dollars will be paid over by the end of the 2012/13 fiscal year."