Tobacco tax up again
Wednesday, March 20, 2013 at 14:06 Tobacco tax has risen by 5.3 per cent as a result of today's Budget.
It could have been worse. The Chancellor introduced a tobacco escalator for tobacco two (three?) years ago and last year he increased duty by five per cent above inflation.
This year he's gone back to two per cent over inflation.
Forest has issued this statement:
"We are disappointed that the Chancellor has not scrapped the above-inflation rise in tobacco tax.
"Increases in the cost of tobacco hit those who can least afford it the most.
"The only people cheering tonight will be criminal gangs who can look forward to more people buying cigarettes on the black market.
"This will lead to a further loss of revenue for the government at a time when the country can least afford it."
At least beer duty has been cut (by 1p) and the fuel duty rise has been scrapped.
Update: Thanks to Clemmy for pointing out that ASH aren't happy. Not such a bad day, then!
Reader Comments (23)
I'd be surprised if many 20 a day smokers on low income still pay tobacco duty. Half price imported tobacco and cigarettes are available from all good corner-shops.
ASH are not very happy.
http://ash.org.uk/media-room/press-releases/:tobacco-tax-rise-is-a-missed-opportunity-and-falls-short-of-optimum-increase
Headline could read.
Smuggling up again !
Haven't paid UK duty on tobacco in ages. I consider it my duty not to pay any UK tax on tobacco. We are well past the Laffer Curve's optimum tax rate. Depending on the brand, it costs less than a pound to manufacture a packet of fags. Manufacturer and retail mark-ups are tiny compared to UK taxes -- the duties make up close to 90% of the retail price. It's even worse for hand-rolling tobacco now, thanks to ASH and our government. Anyway, if the government wants to fiscally rape tobacco consumers, then consumers must defend themselves accordingly and NEVER buy your tobacco from UK retailers. Go abroad, if you can. If you cannot travel, then you know what to do...
As I tweeted this morning:
ASH @ASH_LDN
The Financial Statement by the Chancellor of the Exchequer is about to start (12:30). What is @george_osborne planning for tobacco products?
David Atherton @DaveAtherton20
@ASH_LDN @George_Osborne More trips to Belgium with tobacco a third of the price in the UK. Wine in France @ £2/bottle. #laffercurve
More reason to keep shopping Belgium. ASH only hate it because it means less money they can scrounge.
Tobacco always goes up. we are cash cows that pay more so others, like drinkers and car fanatics, pay less - and we then get abuse and scam consultations for our money.
Enough is enough! More than enough!
I have just spent half an hour trying to find ANY mention in the rise of tax on cigarettes to no avail! How much a pack will it go up as this is how I plan my finances?!!! One fifth of us are smokers yet no news site seems to be bothered to give us this vital piece of information!
I know beer duty has been cut by 1p, however, this will not save the pub industry.
Liz, I believe that a pack of 20 will go up, on average, by 26p. This compares to 37p last year. The reason it hasn't been mentioned by the media is that the Treasury had already let slip what it intended to do so there was no news story, unlike last year when the five per cent above inflation increase came as a surprise.
There are two alternatives to buying from abroad or buying on the black market, both legal, both much cheaper. One, grow your own from seed. Two, buy whole leaf tobacco - comes ready cured, just needs shredding. Several UK websites-based will sell you both.
I'm glad to see that Simon published PTB's comment. That proves to me that Forest is not a creature of the Tobacco Industry.
I have started to grow my own as a hobby. I would rather not have to, but how can I otherwise stop financing tobacco control?
As a hobby, it is very rewarding. When you grow your own stuff and cure it yourself, you get tobacco with no additives whatsoever. It is very simple to add flavours of your own choice.
There is nothing illegal about it, any more than there is anything illegal about making your own wine.
@ Junican
Yes, I'm pleased, and a mite surprised as well.You spoke well for the grow-your-own movement. So I'll add more about my favoured solution, whole leaf tobacco. If for any reason people cannot grow their own from seed, buying whole leaf gets you the exact same end product as growing it yourself but without the gardening and curing etc. The last batch of leaf I bought, a mixed delivery of virginia, turkish and oriental, I paid £11.99 per 100 grams p&p free. Being largely housebound, this works perfectly as a solution for me. Not as cheap perhaps as trips to the continent, but with a sweet sense of victory, since the only tax you pay on whole leaf is VAT. In light of this, the budget worried me not a jot!
P T Barnum: The HMRC website says that imported whole leaf is subject to duty which is why, to date, I've not bothered. If you buy leaf from this country, is the duty already paid and is it still cost effective?
In this document,
http://www.hmrc.gov.uk/budget2012/tiin-0730.pdf
there is no mention of whole leaf tobacco. The "other smoking tobacco" duty is £9.18 per 100gms. At £11.99 per 100gms inc p&p, what P T paid, it isn't clear if duty has been paid. £11.99 is a lot for dried leaves, but they only have to undercut hand rolling tobacco
http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageExcise_ShowContent&id=HMCE_CL_000268&propertyType=document#P125_15538
2.9 & 2.10. So I assume that the duty has already been paid on leaves purchased from this country and the individual would be given a bill for imported leaf probably to pay before it was released.
I already use the JPS 'tubs' ( 50grm @ £14.60) but always looking out for other methods.
Apologies for the delay in replying to the questions. I do so love hospital waiting rooms. Not.
I understood that whole leaf was classified as an agricultural product, but I may well be wholly wrong.
The company I ordered from last is based in Belfast and makes much of being full compliant with all duties. Simon may not appreciate the link to their site but I'll give it, not to advertise them (tho' I am a satisfied customer) but to show what I was talking about.
http://www.wholeleaftobaccoonly.com/New-product-and-checkout-page.html#!/~/category/id=4302273&offset=0&sort=normal
Other UK suppliers are available, although my previous one was having trouble getting stock, which is why I changed.
PT: Cheaper than I'm paying now, nice one. Must get shredding.
Thanks to you and Jonathan.
PTB - apologies if this is a silly question but, how do you shred it - are there machines?
The point raised by PTB and FJ are the reason that I do not like talking much about the subject. But can I just say this. It is tobacco products which are liable for duty and not tobacco itself. Using a hand operated machine which can make only one cigarette is not manufacturing tobacco products as stated in the document FJ refers to. Only premises which are used for tobacco product manufacturing need to be registered. Manufacturing only takes place in registered premises.
As much as anything, duty is levied by the kilogram</I> or by the 1000 as regards cigarettes. Clearly, the idea of taxing an individual person who makes himself a few fags from some home-grown leaves would be nonsense. The amounts involved would trivial and the cost of collection and accounting would be ridiculous.
"The amounts involved would trivial and the cost of collection and accounting would be ridiculous."
Since when has that ever bothered them? I like to think it soon will but I'm not holding breath.
Joyce.
Yes there are machines. I have one which cost me £30 altogether. I am very happy with it. It is hand operated, very sturdy and shreds leaves very quickly.
PT paid a lot. I got 400 grams for £20.
Look around on the net.
The ever rising cost of UK tobacco product are just forcing smokers to go abroad for their tobacco and cigarettes
UK Government biggest cartel ever. Show me a tobacco smuggler making in excess of 10 billion per annum.
If all smokers stopped tomorrow there would be a revolution in response to the non smokers having to pay inflated taxes of all kinds to make up the shortfall!
Also, logic says that as smoking so definitely causes so much expense to the NHS then all illnesses must also be caused by the individual therefore we must all share equally the cost. Just as the NHS was originally designed to do.
Rant over......