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According to the President’s decision on the redetermination of the SCT rates that will be applied to some goods published in the current edition of the Official Gazette, the fixed and fixed minimum tax amounts for cigarettes and some tobacco products are not increased in the first 6 months of 2021, while the SCT rate is 63 percent from 67 percent. has been reduced to.
According to the decision, the minimum flat tax amount for cigarettes and some tobacco products was TL 0.4883 and the flat tax amount was TL 0.42, the same as the previous amounts announced on July 3, 2020 .
UP TO 50 BASE POINTS
QNB Finansbank chief economist Erkin Işık stated that fiscal regulations will cause a 50 basis point decrease in annual inflation, while Yatırım Finansman calculated that the effect will be a 53 basis point decrease in the note published this morning.
Economists also point out that the effect may vary depending on the price behavior of tobacco companies.
On the other hand, a source who informed Reuters said: “With the SCT regulation on tobacco, the demand for a necessary increase in the sector has disappeared. With the regulation of the SCT the upward inflationary pressure that can come from here has been lifted ”.
THE LARGEST SECTION OF WEIGHT IS FROM SMOKING
According to data from TURKSTAT, tobacco products and cigarettes are found within the heading of alcoholic beverages and tobacco in the inflation basket, with a weight of 6.06 percent. Most of the weight in this item belongs to cigarettes at 5.71 percent, and cigarettes are weighted higher than other items in overall consumer price inflation due to high weight.
While inflation rose above 14 percent in November, the expectation before regulation of the cigarette tax was that inflation would hover around 15 percent in the first months of next year. After the non-tax changes, Işık said annual inflation could remain below 14 percent in the first quarter.
Due to the high course of inflation, the CBRT tightened 675 basis points in the last two meetings of the MPC, 200 basis points yesterday and 475 basis points in November. (REUTERS)
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