There has been a huge drop in cigarette sales according to the latest figures released by Gallaher, the country's largest cigarette manufacturer.
Smokers in Ireland will buy 500 million fewer cigarettes this year following a 7.5% fall in the market during the first six months of the year.
The means that about 260 million fewer cigarettes were sold between January and June, and if the trend continues tax returns from tobacco will fall by €81m this year.
The Department of Finance had only forecast a drop in tobacco tax income of around €70m.
More than seven billion cigarettes are sold in Ireland every year. Last year the Exchequer benefited by €1.1bn from tax on tobacco.
The Gallaher group, which has around 50% of the cigarette market in Ireland, said tax increases and the smoking ban had contributed to the drop in sales.
