One million snus-users in Sweden will face new tax increases on snus

The Swedish Government budget proposal, to be presented on September 20, 2007, is expected to include a new tax increase on tobacco products including snus, which is proposed to be SEK 2,70 for 24 g (pouch) and SEK 5,63 for 50 g (loose). The numbers include VAT and the increase is expected to be effective as of January 1, 2008.

In the light of the recent tax increase in January 2007, where the tax increased by SEK 3,69 for 24 g and SEK 7,69 for 50 g snus, including VAT, the new tax proposal was unexpected.

Swedish Match is currently analyzing the situation and will take all necessary actions in order to protect and improve profitability in the Swedish market.

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Swedish Match is a global Group of companies with a broad assortment of market-leading brands in smokeless tobacco products, cigars, pipe tobacco and lights products. The Group’s global operations generated sales of 12,470 MSEK for the twelve month period ending June 30, 2007. Swedish Match shares are listed on OMX Nordic Exchange in Stockholm (SWMA).

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Swedish Match AB (publ), SE-118 85 Stockholm
Visiting address: Rosenlundsgatan 36, Telephone: +46 8 658 02 00
Corporate Identity Number: 556015-0756
www.swedishmatch.com
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For further information, please contact:
Lars Dahlgren, Chief Financial Officer
Office +46 8 658 04 41, Mobile +46 70 958 04 41
Henrik Brehmer, Senior Vice President Corp. Communications
Office +46 8 658 04 52, Mobile +46 76 111 34 14
Emmett Harrison, Vice President, Investor Relations
Office +46 8 658 01 73, Mobile +46 70 938 01 73