Tax on cigarettes rose at midnight yesterday, as the Finance Ministry maneuvers to increase its income from tax. In an effort to reduce the projected deficit ahead of today's presentation of the budget for 2011 and 2012, Finance Minister Yuval Steinitz signed the amendment to tax regulations. The amendment came into effect at midnight last night. The tax hike is expected to increase the cost of a pack of cigarettes by NIS 1.50 to NIS 2.00.
The minimum tax per pack has been set at NIS 9.50. The treasury calculates that the tax hike should increase its revenues by NIS 700 million a year. Although the order took effect immediately, it will be put to a vote by the Knesset Finance Committee within the next couple of months. An increase on gasoline taxes is also expected in the near future.
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