1, VAT
Tobacco belongs to commodity sales. According to the Notice of the Ministry of Finance of State Taxation Administration of The People's Republic of China on Adjusting the VAT Rate in May 20 18, the VAT rate is 16%.
2. Consumption tax
According to State Taxation Administration of The People's Republic of China's Notice on Adjusting Cigarette Consumption Tax, tobacco consumption tax consists of ad valorem tax and specific tax.
(1) Ad valorem tax: In the production process, 56% of Class A cigarettes, 36% of Class B cigarettes, 36% of cigars and 30% of cut tobacco. At the wholesale stage, ad valorem consumption tax is levied on all cigarettes, and the tax rate is 1 1%.
(2) Specific tax: A specific tax of 0.003 yuan/cigarette is levied on all cigarettes in the production process; In the wholesale link, a specific tax of 0.005 yuan/cigarette is levied on all cigarettes.
According to the World Bank 200 1 survey, if the consumption tax is increased, the price of cigarettes will increase and the consumption will decrease accordingly, but the decrease in consumption is lower than the increase in price. Generally speaking, the country's total tax revenue will increase. The survey also believes that it will be easy to collect taxes because the government can strictly monitor the production of cigarettes. Although the consumption of cigarettes has decreased, the tax amount of the whole country will not decrease because of the increase of tax rate.
The consumption of cigarettes in China is divided into several grades. The gift of high-grade cigarettes is of great significance. If you smoke, don't buy it. If you buy it, don't smoke. The price elasticity of this kind of consumption is extremely small, and the higher the price, the stronger the purchase intention. As for the low-end market, cigarettes are a commodity with little price elasticity because of their addiction, and ordinary consumers will not give up smoking because of the price increase. Therefore, increasing tobacco tax has little effect on reducing consumption.
The survey emphasizes the important role of raising tobacco tax in reducing smoking among teenagers. Teenagers are more sensitive to cigarette prices because of their weak economic ability. If the price of cigarettes increases by 10%, the same proportion of young people will reduce smoking. More importantly, because of the high threshold for entering the smoking team, high prices will prevent some young people from smoking.
There is a special chapter in the World Bank survey to study the impact of raising tobacco tax on low-income people. The survey report shows that cigarette consumption of low-income people often accounts for a higher proportion of their income. In order to cope with the rising price of cigarettes, they are more likely to quit smoking or reduce smoking, which is beneficial to their health, and at the same time, they will spend the income originally used to buy cigarettes on other goods and services.
References:
Baidu encyclopedia of tobacco price increase? Increase in the price of cigarettes Baidu Encyclopedia