ISET Economist Blog

A blog about economics in the South Caucasus.

How to Prevent the Tobacco Law from Going Up in Smokes?

BACKGROUND After a hike in excise tax on cigarettes in January 2017, Parliament of Georgia is going to introduce legislative changes to the existing tobacco control law (TCL) in March. Since its enactment in 2003, TCL has been modified several times. However, the recently proposed changes can be considered the most radical step towards a tobacco-free society in Georgia. New draft law comprehensively covers production, packaging, marketing, advertising, selling and consumption of tobacco, and other activities of tobacco businesses. The main changes can be...
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Price and Prejudice on the Georgian Market for Cigarettes

Benjamin Franklin once said, “In this world, nothing can be said to be certain, except death and taxes.” Yet we have a tax that could prevent hundreds of millions of premature deaths. It is time to use it more effectively. -Prabhat Jha It is a truth universally acknowledged, that cigarettes are bad for human health. Yet, whenever the government tries to regulate consumption of cigarettes by increasing their price, it gets a very mixed reaction from the public. Some people (mostly non-smokers) welcome these policies, while others accuse the government of ...
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Excise Tax Experiments with the Georgian Beer Industry

During the last 12 months, the Georgian authorities have been conducting interesting experiments designed, so it seems, to test the resilience of domestic beer producers. In September 2014, the industry was hit by Article 171 of the Civil Code, prohibiting alcohol consumption in public places. The beer market, 97% of which is supplied by local producers, has immediately shrank by 22% (in physical volume, see chart), in annual terms. As if that were not bad enough, the Georgian Ministry of Finance had another surprise up its sleeve: a doubling of excise t...
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