Egypt Hikes Cigarette Prices as New VAT Law Takes Effect

See - Sada Elbalad

2 days ago

Taarek Refaat
In a bold fiscal move aimed at bolstering state revenues, Egypt has officially raised cigarette prices following parliamentary approval of amendments to the country's Value Added Tax (VAT) law.
The price hikes, effective Wednesday, July 2, have pushed the cost of both local and imported cigarette brands to record highs, sparking widespread consumer and media attention.
According to Ibrahim Imbaby, head of the Tobacco Division at the Federation of Egyptian Industries, the newly approved pricing structure aligns with three tax brackets, each impacting cigarette brands differently. Imbaby hailed the legislation as a "timely and strategic decision" that supports both government income and price stability for tobacco companies.
Local Brands: Cleopatra Hits New Ceiling
Cleopatra, Egypt's most widely consumed cigarette brand, saw its retail price surge from EGP 38.70 to EGP 48 per pack across all variants — including King Size, Super, Soft Queen, Box, Black Label, and others.
Other domestically produced brands such as Boston, Bloment, Mondial (Red, Blue, Silver), and Matsuyan Super now also retail for EGP 48.
Imported Brands: Marlboro and Merit Top EGP 100
Multinational tobacco products under Philip Morris have also experienced substantial increases:
Marlboro: Jumped from EGP 89 to over EGP 100 in many kiosks and retailers.
Merit: Rose from EGP 95 to above EGP 105, placing it firmly in the premium category.
LM: Now priced at EGP 69, up from EGP 69 pre-tax change, solidifying its mid-tier classification.
HEETS & TEREA (Heated Tobacco): Varieties such as Selections, Dimensions, and Capsules are now selling for EGP 74.
New Pricing Brackets Introduced
The updated tax framework organizes cigarette products into three main price brackets:
Tier 1 (Economy): Max retail price raised from EGP 38.80 to EGP 48
Tier 2 (Mid-range): Capped at EGP 69
Tier 3 (Premium imports): Starting from EGP 96 and up
Government Stance & Industry Reaction
The VAT adjustment law, first debated in Parliament over the weekend, aims to rationalize consumption while boosting public funds. The government argues that the new structure balances public health concerns with economic realities.
'Tobacco prices in Egypt have remained artificially low for years,' said a parliamentary source involved in the discussions. 'This step aligns prices more closely with global standards.'
Meanwhile, tobacco companies have publicly supported the tax change, emphasizing its role in reducing pricing disparities and encouraging regulatory clarity.
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