Kingdom of Bahrain hikes duties on alcohol and cigarettes

Kingdom of Bahrain hikes duties on alcohol and cigarettes

Published: 11/02/16

Source: ©The Moodie Report

By Dermot Davitt

BAHRAIN. The Kingdom of Bahrain this week doubled import duties on cigarettes and alcohol products, a move likely to force domestic market prices higher. However, on tobacco in particular, retail price rises will be curtailed, state-owned Bahrain News Agency has said, meaning any additional duty free price advantage is likely to be limited.

A spokesman for Bahrain Duty Free told The Moodie Report that the company was “monitoring the developing situation with regard to import duty” and did not comment further at this stage.

The import duty on alcohol products, which stood at 125% of the value of the goods previously, has risen to 225%. On cigarettes, duty has doubled to 200%.

Bahrain News Agency, a division of the country’s Information Affairs Authority, said in a statement: “Import duty levied on tobacco has increased from 100% to 200% under a recent decision to readjust taxes on special commodities. The move is part of initiatives to develop state revenues and revitalise the financial standing amid budget deficits resulting from plummeting oil prices in international markets.”

But it added: “However, the price of a single packet of cigarette would go up by 200 Fils only. For instance, a packet of cigarettes usually priced at BD1 would be up by a maximum of 200 Fils, to be sold from now on at retail outlets at BD1.200.

“Meanwhile, the prices of US tobacco remain unchanged after an import duty exemption took effect on 1 January, 2016, under the Free Trade Agreement (FTA) binding the Kingdom of Bahrain and the USA.”

In these categories, Bahrain Customs allowances are as follows:
*400 cigarettes, 50 cigars and 250 grams of ryo tobacco;
*One litre of alcohol (wine/spirits) and six cans of beer (non-Muslim passengers only).

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