Tax on cigarette sales what is the effect of valence

cigarette as a very important industry in our country, with the control of the country, the price will naturally change. However, since, many industry and retail terminals on the market after the tax increase tends to hold an optimistic attitude. "The rising" and "Suixingjiushi" popular viewpoint, which is caused by the high expectations of the market.

but from a practical point of view, about the effect of tax on cigarette sales in the market price is very big. Specific performance in two areas:

first, consumers do not understand. People are cheap insects, customer loyalty in front of the price vulnerable. Tax valence, because cigarette price increases greatly, although after publicity, but consumers do not sell off, the contradiction between the increasingly prominent zero. For example, the original wholesale price of 27 yuan / cigarette, after tax, the wholesale price of $28.62 / bar. It is not how to make money, which basically do not make money. However, tobacco companies’s starting point is good, guide retail customers to sell 35 yuan / bar, but not high profit margins.

but, as we all know, now the consumption of low-grade cigarettes are almost sick, or is the economic source of vulnerable groups rarely, many are spending decades of old customers, you suddenly so much of the price, the consumer is certainly not stand. Some consumers said that only with this money. Do you sell or sell as a retail customer? Do not sell to make money, not to sell the offending customers, scold you with money.

second, the decline in profit margins of high-grade cigarettes. The high-grade cigarette retail businesses has been profitable, most love, but because of the high grade cigarette consumption group is less, run slower, and a huge backlog of funds, so the dynamic general retail customer sales is not too big. Sales of high-grade cigarettes are mainly concentrated in the bustling shopping district, a high consumption of urban trunk road and some factories and mines near the enterprise.

, however, rents in such places are relatively high, the cost is larger. After the tax, a thousand yuan stalls cigarettes rose by twenty or thirty yuan each, each rose more than $forty or fifty. For some of the high-end consumer groups in the smoke Hotel, the loss is considerable. According to a senior high-end tobacco store owner, tax valence, pay each year the cigarette wholesale price, to the cost of rent.

don’t look at the tax effect on a seemingly Shun smoke is not great, however, a cigarette store is operated by the mass, therefore, no matter what strains of cigarette tax on retail profits tends to have an impact, the impact is not temporary, in the next period of this the impact will not be eliminated. Valence tax not only allow consumers to feel even worse, also let the retail customers are suffering, suffer indignities inside. Also, many tax along after the retail price is not in line with the market pricing rules and consumption concept. For example

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