The government said Monday that it will intensify its crackdown on those hoarding cigarettes in a bid to stabilize the market ahead of an imminent sharp price hike in tobacco. 

The stepped-up crackdown comes days after the ruling and opposition parties tentatively agreed to raise the prices of cigarettes by 2,000 won (US$1.8) per pack starting next year, which is equivalent to almost an 80-percent increase.

The finance ministry said that it will beef up its monitoring until the end of this year on manufacturers, importers, wholesalers and retailers in the tobacco industry to prevent them from hoarding cigarettes to cash in on strong demand in the run up to the price hike.

Individual consumers, however, are not subject to the monitoring.

Teams consisting of finance ministry officials and local public servants will keep an eye on hoarding activities by regularly visiting manufacturers to inspect how many cigarettes they ship out. Local inspectors will also visit wholesalers and retailers once a week to monitor whether they are hoarding products, the ministry said. 

Those found to stockpile cigarettes will be imprisoned for up to two years or fined a maximum of 50 million won. If necessary, a tax audit could be carried out on violators, it added.

The government has been pushing to raise cigarette prices as part of efforts to reduce relatively high smoking rates and apparently increase the tax revenues at a time when a large amount of tax revenue shortfall is expected amid a delay in economic recovery. 

Earlier, the government estimated that a 2,000-won price hike could lead to 2.8 trillion won in additional tax revenue. 

Over the government's proposal for the price hike, opinions in the National Assembly have been divided with opposition parties arguing that the intended price hike is so steep that it could hurt the livelihoods of low and mid-income earners. (Yonhap)