Business / Corporate

British American Tobacco to raise prices in line with October tax hike

JIJI

British American Tobacco Japan has filed for approval from the Finance Ministry to raise its tobacco product prices in line with the planned tobacco tax hike on Oct. 1, informed sources said Monday.

If approved, British American, known for its mainstay Kent brand, will raise its product prices by ¥30-¥40 per pack. Each pack contains 20 cigarettes.

The company also plans to raise the prices of its glo heat-not-burn tobacco products by a similar margin, but will refrain from a price hike at this time and apply for the ministry approval later.

The tobacco tax is set to be raised by one yen per cigarette on Oct. 1.

Meanwhile, Philip Morris Japan plans to withdraw its price hike application and seek Finance Ministry approval for smaller price increases than initially planned, the sources said.

Philip Morris now plans to file for a price increase of ¥40 for packs containing 19 or 20 cigarettes, against its initial plan of ¥50, out of concerns that the larger price increase may turn off smokers and lead to the deterioration of its earnings, sources said.

The price of its mainstay Marlboro brand cigarettes is expected to rise from ¥470 to ¥510.

Philip Morris plans to maintain its price hike plan for the Iqos heat-not-burn tobacco products, aiming for a ¥40 increase per pack.

Japan Tobacco Inc. has already filed for ministry approval for almost all of its tobacco products. The price of its mainstay Mevius brand products will rise by ¥40 to ¥480, while the price of a capsule for the Ploom Tech heat-not-burn tobacco device will go up by ¥30 to ¥490.