Action on Smoking and Health (ASH) is pleased to see the
tax escalator on cigarettes will continue at 2% above inflation
(RPI) for the duration of this Parliament. For this year that
will mean a 27 pence increase on a pack of 20
cigarettes.[1]
In addition to the tax escalator for all tobacco products
there will be a one-off 4% increase for hand rolled tobacco,
meaning handrolled tobacco will increase by 6% above RPI. The
increase will mean an extra 67 pence on a 30g pouch of
tobacco.[1] [2] This is welcome but future budgets need to commit
to extending this for the duration of this Parliament.
ASH also welcomes the uprating of minimum excise tax (MET)
on cigarettes. The new MET will be £6.10
(previously £5.88) for a pack of 20. [1]
[2] Increasing the MET raises the price of the
cheapest cigarettes and discourages smokers switching to cheaper
brands instead of quitting smoking altogether. This effectively
means the lowest price for a pack of 20 cigarettes will be £8.23
from 6pm today. [1] [2]
However, ASH is disappointed that the Chancellor has not
increased the annual tobacco tax escalator from 2% to 5% above
RPI for factory made and 15% above RPI for handrolled tobacco, as
recommended by ASH and the UK Centre for Tobacco and Alcohol
Studies in its submission to the Chancellor.[3] Reducing the
affordability of tobacco is recognised to be the most effective
way of reducing smoking prevalence and the higher the escalator
above inflation, the greater the impact it has and the greater
the potential to save lives. [4]
Deborah Arnott, Chief Executive of ASH, said:
“Despite
successive years of tax increases, the past failure to close the
gap in tax on handrolled tobacco has kept smokers smoking who
might otherwise quit. Thousands of smokers have switched to
cheaper hand rolled tobacco in recent years. We welcome the
Government’s efforts to address this, but it must go beyond a
single year.”
ASH is pleased to see the announcement of additional
resource for trading standards and HMRC to combat illicit tobacco
trade, alongside a commitment to consult on stricter penalties
for trading in illicit tobacco. Stronger enforcement measures
will ensure these tax rises have most impact. However, with the
UK leaving the EU it is time the Government refreshes its illicit
tobacco strategy in line with the requirements of the Illicit
Trade Protocol which the UK is a Party to.
ASH is also disappointed that the Government has not taken
this opportunity to impose a ‘polluter pays’ charge on tobacco
companies. This would raise the resource needed to deliver on the
Government’s ambition of a smokefree England by 2030.[5] The
Government said it would consider proposals for a ‘polluter pays’
charge on the industry overseen by the Department of Health and
Social Care (DHSC) in a green paper published eight months ago to
help deliver the ambition of a Smokefree 2030, and the Budget
would have been an ideal opportunity to announce the next
steps.[5]
Ms Arnott added:
“Reducing the affordability of tobacco is a vital
measure to tackle smoking but it must be part of a comprehensive
strategy to help smokers quit. Tobacco companies are highly
profitable, profits made from addicted smokers unable to quit
smoking. If the tobacco industry is to continue to be allowed to
sell its deadly products it should also be made to pay to help
deliver the ambition of a Smokefree 2030.”
ASH and other public health organisations have been calling
for a Smokefree 2030 Fund which would collect a fee from the
major tobacco manufactures in England. Tobacco transnational
Philip Morris International (PMI) recently campaigned for their
own version of such a fund showing that the highly profitable
industry could afford it. However, PMI’s proposal included giving
the tobacco industry influence on how the money would be spent
and its products would be regulated.
The Government is to be congratulated for rejecting any
such partnership with the industry [5] but should instead put in
place a statutory system to require the tobacco industry to fund
tobacco control, completely independent from the industry in line
with our legal obligations [6].
ENDS
References:
[1] HM Treasury and The Rt Hon Rushi Sunak MP, Budget 2020.
Available from: https://www.gov.uk/government/publications/budget-2020-documents/budget-2020
[2] HMRC Tobacco Duty Product Rates. Available
from: https://www.gov.uk/government/publications/rates-and-allowances-excise-duty-tobacco-duty/excise-duty-tobacco-duty-rates
[3] ASH UKCTAS Budget submission endorsed by 24 other
health organisations. Available from: https://ash.org.uk/wp-content/uploads/2020/01/ASH_UKCTAS_Budgetsubmission2020FINAL.pdf
[4] Chaloupka F, Yurekli A, Fong G. Tobacco taxes as a tobacco
control strategy. Tobacco Control 2012;
21:172-180.
[5] Department of Health and Social Care and Cabinet
Office. Advancing our health:
prevention in the 2020s. 2019.
[6] Hansard. Adjournment debate: WHO
Framework Convention on Tobacco Control. March 2020
Accessible here: https://hansard.parliament.uk/Commons/2020-03-05/debates/E4AA5003-7831-4572-8524-CED86A647B75/WHOFrameworkConventionOnTobaccoControl
[7] WHO FCTC Article 5.3 guidelines Available
from: http://www.euro.who.int/en/health-topics/disease-prevention/tobacco/publications/2009/who-fctc-guidelines-for-implementation-article-5.3,-article-8,-article-11-and-article-13
