The Tobacco Manufacturers' Association has published the results of its annual survey of over 12,000 adult smokers in the UK.
Subject: their attitudes, awareness and understanding of illicit tobacco.
The key findings are:
The survey also invited responses to questions about the impact of Covid-19 during the first lockdown (April to June 2020). It seems to have had a significant effect in several areas. For example:
During the first lockdown 16 per cent of respondents bought illicit tobacco through social media or websites advertising cheap tobacco – compared to only four per cent who purchased illicit tobacco from the same sources before lockdown.
Twenty-four percent of respondents found it harder to obtain cigarettes/RYO from corner shops and newsagents, while 22 per cent found it harder to obtain them from supermarkets including online delivery.
The latter finding supports several emails we have received from smokers who have been unable to get their preferred brands from a supermarket online. Alternatively the supermarket has failed to offer a substitute brand.
Waitrose, as I reported last month, actually has a national policy of NOT supplying substitute tobacco brands.
More recently (March 5) we received this email:
Problems with Sainsbury's today. Ordered one pack of 100 superkings plus two different packs of 20 superkings. Received only one pack of 20 with the others marked 'no suitable substitutes'. Perhaps because I ordered the cheaper ones but I would have accepted more expensive brands and would have had (I assume) the usual option of returning subs if not acceptable.
In terms of smokers' attitudes, the survey offers little comfort for legitimate retailers in the UK or the Treasury.
For example, 52 per cent of respondents admitted that the high price of tobacco tempts them to buy tobacco that has not had UK tax paid on it.
42 per cent went further and said they had no objection to buying tobacco that has not had UK tax paid on it from a friend, relative, shop etc. (In contrast only 30 per cent disagreed with this proposition.)
Two out of three respondents (66 per cent) had no objection to buying tobacco for themselves that did not have UK tax paid on it as long as it came from a legal source.
Fifty-three per cent of respondents believe it is OK to buy tobacco overseas and in duty free shops to bring back to the UK to sell to friends and family, with 57 per cent agreeing with the statement, 'I plan to buy tobacco products abroad and bring back as many cigarettes/tobacco as I legally can'.
The lesson here is that attempts to guilt trip smokers who don't pay UK tax on tobacco are likely to fall on deaf ears.
As for reporting those that buy and consume illicit tobacco, '78 per cent of those who are aware of illicit tobacco being sold in the last 12 months have not reported it'.
Furthermore, 55 per cent of those asked had not reported the sale of illicit tobacco to anyone because they believed it was 'none of their business'.
This broadly complement the findings of polls commissioned by Forest in the UK and Ireland. Asked whether it was "understandable" if smokers purchased tobacco illegally, a whopping 70% of respondents (smokers and non-smokers) said ‘yes’ in Ireland (2020), 67% in the UK (2016).
In other words, when tobacco duty is so astonishingly high, even non-smokers are reluctant to be judgemental about buying illicit tobacco, let alone report it to the authorities.
Like most people I don't condone breaking the law but when it comes to purchasing tobacco illegally it's interesting that a substantial majority think it's "understandable" and "none of their business".
And who's responsible for that? The finger of blame points firmly at successive governments and their relentless urge to punish smokers for their habit whilst squeezing every last penny out of them, even if it means forcing poorer smokers further into poverty.
According to Rupert Lewis, director of the TMA:
"This year’s survey findings highlight both the widespread availability of illicit tobacco, but also the entrenched perception among many consumers that it is ‘acceptable’ to trade or buy illicit tobacco.
"It remains a startling fact that, out of over 12,000 consumers questioned in the survey, seven out of ten (70 per cent) said that they had bought illicit tobacco in the last twelve months."
More interesting perhaps is the revelation that one in five smokers (20 per cent) claimed that they only purchased ‘branded’ cigarettes or ‘branded’ roll your own tobacco. As Lewis notes:
"This is especially concerning, as all ‘branded’ tobacco products have been banned in the UK since 2016."
What's interesting to me, a non-smoker, is the range of sources for buying illicit tobacco. They include markets, car boot sales, vans, private houses, friends and family (those who smoke and those who don't), social media and/or websites advertising cheap tobacco, people in the street or someone selling in a pub, bar or café.
The TMA reports that cigarette and hand rolling tobacco accounted for £10.6 billion in government revenue in 2019-20, according to HMRC, and in the most recent HMRC Tax Gap Estimates 2018-19 up to £1.9 billion of lost government revenue was caused by the consumption of illicit tobacco.
Naturally the TMA wants to highlight the loss of revenue, the impact on legitimate retailers, and whether there are sufficient deterrents (legal, social etc) to dissuade or prevent people from selling and/or buying illicit tobacco.
From a liberal perspective I believe the focus has to be on the levels of tax because that's the fuel that drives the purchase of illicit tobacco.
It's not a victimless act – there's evidence, for example, that terrorists profit from it and legitimate retailers obviously lose business – but when the tax on tobacco is so high it's wrong to focus on the consumer when the root cause is staring us in the face.
Despite last week's Budget, which I wrote about here, the Chancellor is committed to increasing the tax on cigarettes by inflation plus two per cent every year during this parliament.
On the basis of this survey he should reconsider this policy and either freeze tobacco duty or abandon the 'inflation plus' escalator.
If he's not minded to do that, he must politely but firmly reject all calls to hike taxes above the existing escalator and explain why.
The evidence demands a tobacco tax policy that recognises the damage being done by the existing policy and acknowledges that smokers cannot be society's whipping boys forever.
Full survey here.