Reasons for the official increase in cigarette prices in Egypt

Increasing production and controlling the market...the reasons for officially increasing cigarette prices in Egypt

The Eastern Tobacco Company, Inc., raised the prices of cigarettes and tobacco products for the third time in about a year.

New taxes

The latest increase came on Wednesday, November 8, 2023, in the prices of cigarettes in the Eastern Province, due to new taxes approved by the Egyptian government, on tobacco and smoke, at varying rates ranging from 3 to 7.5 pounds per pack of cigarettes.

Reasons for increasing cigarette prices in Egypt

The head of the Tobacco Division at the Federation of Egyptian Industries, Ibrahim Embabi, said in press statements that the increase in cigarette and tobacco prices in Egypt is a step by the government to limit the rise in cigarette prices in the parallel market, which has reached a record level.

The head of the Tobacco Division explained that the new increase was presented to the producing companies and the Tobacco Division, before it was approved by the House of Representatives, and was approved by the Division. These increases would add 8 billion pounds to the state treasury, and they also support the trends of increasing cigarette production in companies.

Cigarette prices in the parallel market

The head of the Tobacco Division added that there are several steps to return cigarette prices to the official level in public markets in Egypt, after a pack of the popular Box and Cleopatra cigarettes reached 70 pounds per pack, even though the official price for them since last April was 24 pounds.

The head of the Tobacco Division added that companies producing cigarettes must move to selling horizontally to merchants, grocery stores, and major retail chains, in order to maintain the official level of cigarette sales and not raise it in informal markets in Egypt.

Selling entities at an official price

  Traders in the Egyptian market explained that the prices of all popular cigarettes are sold at double the official price in public markets.

The only places that sell cigarettes at the official price, which starts at 23 pounds for a pack of cigarettes, are gas stations, while in public markets they are sold for 60 to 70 pounds.

A series of cigarette price increases in Egypt

About a year ago, in late September 2022, Eastern Tobacco began a series of cigarette price increases, during which it raised the prices of Cleopatra, Box, and other types of cigarettes to 22 pounds, then last April, it raised them to 23 pounds, according to the company’s official data, but the quantities that were available in the markets were not sufficient for demand, which led to an increase in cigarette prices in the parallel market.

On Wednesday, November 8, 2023, the Eastern Tobacco Company announced that the Board of Directors had approved the price list for cigarette, honeycomb, cigar, and hair smoke products, with an increase of between 3 and 7 pounds.

A company statement made it clear that the increase is in implementation of the provisions of the value-added tax and its amendments issued by Law No. 177 of 2023, provided that the new prices will be applied as of the morning of Thursday, November 9, 2023.

Price list of new popular cigarettes

Cigarette packs (box of 10 cigarettes 20 pounds, Cleopatra-King Size 27 pounds, Cleopatra-Soft Queen 27 pounds, Cleopatra-box 27 pounds, Boston 27 pounds, Belmont 27 pounds, Cleopatra Super 27 pounds, Mondial 27 pounds, Mondial Switch 27 pounds, Cleopatra Black Label 27 pounds, Matossian Super 27 pounds, Viceroy 42 pounds, Pal Money at 42 pounds).

Tightening controls on cigarette prices

Commenting on the market situation following the increase in cigarette prices, Hani Aman, CEO and Managing Director of Eastern Company, said that the company is cooperating with regulatory authorities to tighten control over cigarette prices in the markets.

He praised the role played by the regulatory agencies during the last period, which had a strong impact on reducing prices. At the same time, Aman explained that the company cancels the contracts of any merchants or distributors who are proven to have not adhered to the official prices.