Ahead of the 2027 Bud­get pre­sen­ta­tion, stake­hold­ers con­nect­ed to in­dus­tries that were sig­nif­i­cant­ly im­pact­ed by one of the de­ci­sions made in last year’s pre­sen­ta­tion are urg­ing the Gov­ern­ment to re­think its stance.

In last year’s Bud­get Pre­sen­ta­tion, Fi­nance Min­is­ter Dave Tan­coo in­creased ex­cise and cus­toms du­ties on al­co­holic bev­er­ages and to­bac­co prod­ucts by 100 per cent.

This dou­bled du­ties on beer from TT$5.14 to TT$10.28 per litre, while Rum and Spir­its saw tax­es dou­ble from 79.25 per cent to 158.50 per cent of al­co­hol con­tent, and cig­a­rettes and to­bac­co saw ex­cise du­ties dou­ble from $5.26 to $10.52 per pack of 20.

Malt bev­er­ages al­so saw rates ad­just­ed by 100 per cent to align with do­mes­tic and re­gion­al tax lev­els.

In that pre­sen­ta­tion, the Fi­nance Min­is­ter said the de­ci­sion was meant to in­crease State rev­enue from these in­dus­tries while al­so im­prov­ing pub­lic health out­comes.

In the weeks lead­ing up to bud­get, lo­cal dis­tillery An­gos­tu­ra con­firmed in its half year fi­nan­cial state­ments that the in­crease con­tributed to a drop in rev­enues and prof­its de­spite a sev­en per cent in­crease in lo­cal sales. The com­pa­ny’s chair­man Gary Hunt said the com­pa­ny ab­sorbed costs to have cus­tomers avoid fac­ing the full brunt of in­creas­es.

The de­ci­sion al­so im­pact­ed sev­er­al in­dus­tries, with some restau­rant and bar own­ers con­firm­ing that the in­creased costs led to their busi­ness­es see­ing sig­nif­i­cant de­clines in traf­fic. Some es­tab­lish­ments closed en­tire­ly as the sales re­quired to break even be­came a chal­lenge.

Mean­while, some event pro­mot­ers al­so stat­ed they too strug­gled to be prof­itable af­ter the change.

In a wish­list is­sued ahead of to­mor­row’s bud­get, the Trinidad and To­ba­go Man­u­fac­tur­ers’ As­so­ci­a­tion called for “re­lief from the in­creased ex­cise tax­es af­fect­ing lo­cal­ly man­u­fac­tured al­co­hol and to­bac­co.”

How­ev­er, the re­cent pass­ing of leg­is­la­tion that would in­crease the le­gal age for al­co­hol and to­bac­co from 18 to 21, while rais­ing the min­i­mum age for gam­bling and cannabis to 25, has caused even greater con­cern with­in those sec­tors.

Pri­or to the de­bate on the Mis­cel­la­neous Pro­vi­sions (Al­co­hol, Cannabis, Dan­ger­ous Drugs, Gam­bling and To­bac­co) Bill, 2026, the Trinidad and To­ba­go Cham­ber of In­dus­try and Com­merce and the Trinidad and To­ba­go Bev­er­age Al­co­hol Al­liance called for the leg­is­la­tion to be put on hold, pend­ing con­sul­ta­tion.

Oth­er stake­hold­ers point­ed out that the move would nat­u­ral­ly re­move a seg­ment of ex­ist­ing cus­tomers from the mar­ket, thus fur­ther re­duc­ing busi­ness in those in­dus­tries and re­lat­ed sec­tors.

How­ev­er, the age lim­it bill was ap­proved ear­ly Wednes­day morn­ing fol­low­ing a 15- 12 vote in the sen­ate, with no Op­po­si­tion or In­de­pen­dent Sen­a­tor vot­ing in favour.

In the wake of this, a stake­hold­er with­in the to­bac­co in­dus­try is warn­ing that the move may give more strength to the il­lic­it to­bac­co mar­ket.

The stake­hold­er, who did not wish to be pub­licly iden­ti­fied, said via a note sent to the Sun­day Busi­ness Guardian, “As Trinidad and To­ba­go con­tin­ues to in­tro­duce changes to the reg­u­la­to­ry en­vi­ron­ment gov­ern­ing to­bac­co prod­ucts, greater at­ten­tion must be paid to the cu­mu­la­tive im­pact of these mea­sures and the un­in­tend­ed con­se­quences they may cre­ate for con­sumers, le­git­i­mate busi­ness­es, Gov­ern­ment rev­enue and the fight against il­lic­it trade.”

The stake­hold­er ac­knowl­edged the pub­lic health ar­gu­ment raised but point­ed to ev­i­dence that the il­lic­it mar­ket had grown since the Gov­ern­ment in­creased the du­ties on to­bac­co last year.

“Ef­fec­tive reg­u­la­tion must al­so take ac­count of the re­al­i­ties of the mar­ket in which those mea­sures are be­ing im­ple­ment­ed. When re­stric­tions on le­git­i­mate prod­ucts in­crease with­out equal­ly strong mea­sures to sup­press il­le­gal sup­ply, there is a risk that con­sump­tion is dis­placed from the reg­u­lat­ed mar­ket in­to one that op­er­ates en­tire­ly out­side the law,” the no­tice said, “That risk is par­tic­u­lar­ly rel­e­vant in Trinidad and To­ba­go, where the pres­ence of il­lic­it to­bac­co is al­ready ac­knowl­edged. In Au­gust 2025, the To­bac­co Con­trol Unit is­sued a pub­lic no­tice iden­ti­fy­ing 37 il­le­gal cig­a­rette brands be­ing sold in Trinidad and To­ba­go. Since then, re­tail­ers and in­dus­try ob­servers have re­port­ed the con­tin­ued pres­ence of il­lic­it brands in the lo­cal mar­ket.”

The stake­hold­er point­ed out that re­cent­ly, the Gov­ern­ment, through the Min­istry of Trade, In­vest­ment and Tourism and the An­ti-Il­lic­it Trade Task Force, had gone on an ed­u­ca­tion dri­ve about the dan­gers of il­lic­it to­bac­co prod­ucts. This, the stake­hold­er ar­gued, had shown how per­va­sive the il­lic­it mar­ket has al­ready be­come, es­pe­cial­ly as last year’s in­crease al­ready made the le­gal brands less cost ef­fec­tive.

“It al­so makes it in­creas­ing­ly im­por­tant that any fur­ther changes to to­bac­co pol­i­cy are ac­com­pa­nied by clear­ly ar­tic­u­lat­ed and suf­fi­cient­ly ro­bust mea­sures to pre­vent con­sumers from be­ing pushed to­wards the same il­le­gal prod­ucts that Gov­ern­ment is warn­ing them against,” the com­mu­ni­ca­tion added.

“The con­cern be­comes even more sig­nif­i­cant when the cu­mu­la­tive ef­fect of re­cent mea­sures is con­sid­ered. The le­git­i­mate to­bac­co sec­tor has al­ready ab­sorbed a 100 per cent in­crease in to­bac­co ex­cise tax­es in­tro­duced in Oc­to­ber 2025.

“The re­sult has been a fur­ther widen­ing of the price dif­fer­en­tial be­tween le­gal and il­le­gal cig­a­rettes. The low­est-priced le­gal cig­a­rette prod­ucts cur­rent­ly sell for ap­prox­i­mate­ly $24 per pack, while il­le­gal al­ter­na­tives are avail­able for be­tween $12 and $15.”

The note said the re­stric­tions on the reg­u­lat­ed mar­ket should be care­ful­ly as­sessed for their po­ten­tial con­se­quences.

The stake­hold­er added, “Re­mov­ing ac­cess through the le­git­i­mate mar­ket does not nec­es­sar­i­ly re­move ex­ist­ing de­mand. Con­sumers who are no longer per­mit­ted to pur­chase cig­a­rettes or va­p­ing prod­ucts legal­ly may seek al­ter­na­tive means of ob­tain­ing them, whether through friends, in­for­mal sell­ers or il­lic­it dis­tri­b­u­tion chan­nels. This is par­tic­u­lar­ly con­cern­ing when those prod­ucts ex­ist out­side the reg­u­la­to­ry sys­tem, their ori­gin and con­tents may be un­cer­tain, and the per­sons sell­ing them have lit­tle in­cen­tive to ob­serve age re­stric­tions or oth­er con­sumer pro­tec­tions.”

Ger­von Abra­ham, head of gov­ern­ment af­fairs at the West In­di­an To­bac­co Com­pa­ny, sup­port­ed the points raised by the stake­hold­er, as he said, “The con­cern is not with the ob­jec­tive of pro­tect­ing pub­lic health, but with the cu­mu­la­tive ef­fect of in­creas­ing­ly re­stric­tive mea­sures on the le­git­i­mate mar­ket with­out cor­re­spond­ing ac­tion to ad­dress the il­le­gal one.

“Fol­low­ing a 100 per cent in­crease in to­bac­co ex­cise du­ties, fur­ther re­stric­tions could cre­ate even greater op­por­tu­ni­ties for il­lic­it op­er­a­tors. If ex­ist­ing adult con­sumers are pre­vent­ed from ac­cess­ing prod­ucts through reg­u­lat­ed chan­nels, we al­so have to con­sid­er where that de­mand will go and whether suf­fi­cient mea­sures are in place to pre­vent it from mi­grat­ing to the il­le­gal mar­ket.”

Pres­i­dent of the Trinidad and To­ba­go Cham­ber of In­dus­try and Com­merce, Karen Yip Chuck, once again called for con­sul­ta­tion on the top­ic giv­en these con­cerns.

She said, “Tax in­creas­es, with­out de­ci­sive ac­tion to curb il­lic­it trade, risk plac­ing fur­ther pres­sure on le­git­i­mate busi­ness­es while cre­at­ing greater op­por­tu­ni­ties for the il­le­gal mar­ket. Mean­ing­ful con­sul­ta­tion with the busi­ness com­mu­ni­ty is there­fore es­sen­tial to ful­ly as­sess the mar­ket im­pact and de­vel­op prac­ti­cal, bal­anced so­lu­tions that safe­guard gov­ern­ment rev­enue, in­vest­ment and em­ploy­ment.”

The note al­so point­ed out there had been neg­a­tive eco­nom­ic im­pact af­ter last year’s change, as it stat­ed, “The eco­nom­ics of the prob­lem can­not be sep­a­rat­ed from the reg­u­la­to­ry dis­cus­sion ei­ther. Pre­lim­i­nary es­ti­mates in­di­cate that il­lic­it to­bac­co has in­creased by 63 per cent since the ex­cise hike, rep­re­sent­ing ap­prox­i­mate­ly $75 mil­lion an­nu­al­ly in lost Gov­ern­ment rev­enue. Il­lic­it cig­a­rettes gen­er­ate no ex­cise tax­es, VAT or cus­toms du­ties and con­tribute noth­ing to the for­mal econ­o­my. They in­stead cre­ate a par­al­lel mar­ket op­er­at­ing be­yond reg­u­la­to­ry over­sight.”

The Busi­ness Guardian was al­so in­formed by an in­di­vid­ual in the ed­u­ca­tion sec­tor, that this was al­so true with re­gard to the con­sump­tion of al­co­hol, as while it is wide­ly re­port­ed that younger peo­ple are con­sum­ing less al­co­hol glob­al­ly, oth­er prod­ucts have filled that void.

“The ed­u­ca­tor point­ed to the rise in pop­u­lar­i­ty of lean, a mix­ture of codeine cough syrup, so­da, and hard can­dy, amongst teenagers and young adults as one such ex­am­ple.