Smokers to the rescue!
Thursday, May 28, 2020 at 14:23 H/T to Rob Lyons for spotting this.
'Smokers,' tweeted writer and journalist Andrew Orlowski this morning, 'are the only thing saving the economy right now.'
OK, it was tongue-in-cheek, but according to Orlowski tobacco duty raised £1.54bn in April this year, a significant increase on the same month last year.
In comparison beer duty, fuel duty, air passenger duty and other sources of revenue all took a massive hit as a result of Covid-19.
How could this be, given that ASH has claimed that 'More than 300,000 in the UK may have quit smoking during the coronavirus crisis ... while 2.4 million have cut down.'
The figures come from the latest 'HMRC tax receipts and National Insurance contributions for the UK' which you can download here.
According to HMRC:
The volatility in the monthly receipts patterns are due to high clearances one month followed by low clearances the next month. These fluctuations can follow price increases by manufacturers, but is mainly due to forestalling whereby a manufacturer will bulk release products for consumption prior to anticipating duty increases at Budget, though this can vary each year depending on the timings of the Budget. Cigarettes are also subject to anti-forestalling restrictions in advance of a Budget, as explained in HMRC Notice 85C. Receipts for April 2020 are 138 per cent higher than in April last year, most likely due to trader behaviour around the Budget.
I've no idea what some of that means either but let's see if the 'volatility' HMRC refers to continues when the May stats are published.
I imagine the menthol cigarette ban will have some impact on revenue, especially if smokers were rushing to buy stocks before the ban kicked in, so it may be June before things settle down.
Nevertheless it's impossible to deny how important tobacco is to the Treasury.
As a percentage of GDP tobacco receipts are considerably less than they were 40 years ago (it's now 0.4 per cent compared to almost 1.2 per cent in 1980), but the sums involved – almost £9 billion in 2019/20 compared to less than £3bn in 1980/81 – shows how much smokers contribute to the economy, even when smoking rates continue to decline.
If you smoke never feel guilty about the financial cost of smoking to the nation. Tax receipts are facts, unlike the crude estimated costs of treating smoking-related diseases (£2.7bn a year) or the obscene guesstimates said to reflect the cost of days lost at work through illness etc etc.
Smokers are without question net contributors to society. From a non-smoker, thank you!
Smokers are the only thing saving the economy right now pic.twitter.com/qvd9jPHzgN
— Andrew Orlowski (@AndrewOrlowski) May 28, 2020
Reader Comments (6)
Where would they be without us ! Don't forget to let the repulsive ASH woman know !
Tobacco tax is the price we pay for not agreeing with the powers that be, it's just a pity that they are so greedy.
We should be used to it by now, it's been going on over 400 years.
JAMES, by the Grace of God &c. to our right Trustie and right Welbeloved Cousen and Counsellor, Thomas Earle of Dorset our High Treasourer of Englande, Greetinge.
Whereas Tabacco being a Drugge of late Yeres found out, and by Merchants, as well Denizens as Strangers, brought from forreign Partes in small quantitie into this Realm of England and other our Dominions, was used and taken by the better sort both then and nowe onelye as Phisicke to preserve Healthe, and is now at this Day, through evell Custome and the Toleration thereof, excessivelie taken by a nomber of ryotous and disordered Persons of meane and base Condition, whoe, contrarie to the use which Persons of good Callinge and Qualitye make thereof, doe spend most of there tyme in that idle Vanitie,"
"We do therefore will and command you our Treasurer of Englande, and herebye also warrant and aucthorise you to geve order to all Customers Comptrollers Searchers Surveyors, and all other Officers of our Portes, that, from and after the sixe and twentith Day of October next comynge, they shall demaunde and take to our use of all Merchauntes, as well Englishe as Strangers, and of all others whoe shall bringe in anye Tabacco into this Realme, within any Porte Haven or Creek belonging to any theire severall Charges,
the Somme of Six Shillinges and eighte Pence uppon everye Pound Waight thereof, over and above the Custome of Twoo Pence uppon the Pounde Waighte usuallye paide heretofore;
Wytnes our self at Westminster the seaventeenth Day of October." [1604].
I know in my case it’s because I can’t get my cigarettes from abroad as I have since the ban. No one taking holidays and relatives are unable to travel. Sure there are many in the same position but there’s nothing else to spend money on anyway.
The biggest tax payers in this country are the only ones without any rights or representation.
It’s always the elephant in the room, isn’t it? Everybody from the PM downwards knows darned well that they simply couldn’t run the country without the extraordinary levels of duty that they rake in from tobacco sales, and yet no-one ever dares to say it openly. The Covid situation has, if nothing else, highlighted how very much the PTB really need people to go on smoking. In fact, if the longer-term effects on the economy prove to be as disastrous as they look like they are going to be, there’ll be another elephant to join the first one (that, again, no-one will mention) – that in order to run the country, not only do they need smokers to keep smoking, but they need existing smokers to smoke more, and they need more people to start (or re-start), or they simply won’t have enough cash to keep basic services functional. These figures really are a stark reminder of that fact.
It's funny talking to a newsagent today who I've got to know well over the past seven years where I live and buy my Benson & Hedges Gold from told me, over the past couple of months the sale of cigarettes has been unbelievable. So, it shows how many people now get their cigarettes from abroad and other ways. Tobacco duty the only tax, up, I bet, a big part of £15.4bn was from Jan/Feb/March, because very few people have been overseas.