Uruguay Tobacco Tax Hike 2026: New IMESI Rates & Health Policy
The Uruguayan government, under President Yamandú Orsi, has mandated an increase in the Specific Internal Tax (IMESI) for tobacco and cigarettes, effective January 2026. Minister of Economy Gabriel Oddone and Vice President Carolina Cosse ratified the measure, which adjusts the tax burden by 5% to align national fiscal policy with World Health Organization (WHO) standards.
Key Takeaways
- Consumer Cost: Smokers now pay an average of 8 to 10 pesos more per unit following the adjustment.
- Tax Composition: Taxes (IMESI + VAT) now comprise nearly 68% of the final retail price.
- Fiscal Policy: The administration removed tax breaks for tobacco firms to counter a health deficit costing the state 1.5% of GDP.
Economic Impact of the IMESI Adjustment
The decree sets new fixed tax values to curb consumption through pricing leverage. This 5% hike imposes immediate costs on both industrial cigarette packs and loose tobacco products.
| Product Category | Previous Tax Rate | New Tax Rate (Jan 2026) |
|---|---|---|
| Cigarette Pack (20 units) | $107.14 | $111.96 |
| Rolling Tobacco (45g) | $47.72 | $49.87 |
Public Health Strategy and Deficit Control
The Orsi administration prioritizes health outcomes and has reinstated strict industry oversight. The government argues that providing fiscal relief to a sector responsible for high medical costs creates policy inconsistency. Recent Ministry of Public Health (MSP) data indicates that state expenditure on tobacco-related diseases surpasses the revenue these taxes generate.
To secure this policy, authorities enforce a total ban on vapes and heated tobacco products. Simultaneously, the National Customs Directorate has intensified border patrols to prevent the IMESI hike from stimulating the contraband market.
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