Burning our money
Monday, April 20, 2009 It's the Budget this week and we can expect tobacco duty to go up, as it always does at this time of year. But by how much? The Chancellor may be tempted to cane smokers in order to increase revenue, but history tells us that it won't work.
Ironically it was the last Conservative Chancellor Kenneth Clarke (who later worked for British American Tobacco) who introduced the so-called "tobacco escalator". The was the policy whereby tobacco taxation rose in line with inflation plus three per cent. Needless to say his successor Gordon Brown went a step further and made it inflation plus five per cent.
Result? Revenue from tobacco taxation fell by as much as £4 billion a year as the smugglers moved in and criminal gangs made a fortune selling cheaper foreign cigarettes on the black market. It also encouraged a much bigger market for counterfeit cigarettes.
Let's not forget, too, the tens of thousands of people who, quite legitimately, bought their tobacco abroad and brought it back into the country "for their own personal use". In fact, in 2001 a survey by the Tobacco Manufacturers Association suggested that one in three cigarettes smoked in the UK were brought in from abroad, either legally or smuggled and sold here illegally.
The following year Brown jumped off the escalator and since then tobacco duty has risen each year in line with inflation but no more. The smuggling, though, continues so jumping back on the escalator makes no sense because it will almost certainly be counter-productive.
Is that what the Government wants? With this bunch in charge, who knows.
See also: Tobacco duty (Politics.co.uk)
Reader Comments (7)
It would be interesting to find out what percentage of cigarettes are smuggled now. In the past researchers lifted the empty packets at football grounds, pubs, clubs etc and this gave an idea of the amount of illicit smuggling. How are they going to get any data now as those smoking smuggled cigarettes are hardly going to admit to it?
I see more and more people smoking illegal cigarettes and many small shops are quite open about it. The cost is one reason but also there is no sense of obligation due to the attacks on smokers. When hospitals refuse to treat you, you cannot foster or adopt a child and you cannot enjoy a smoke in your office or while out for enjoyment,why should you buy duty paid cigarettes? Unless the government halts the attacks on smokers the smuggling will intensify, as people see little difference between the criminal gangs importing cigarettes and the crooks in charge of the country.
Very well said Michael.
Hubby and I were stopped at Birmingham airport last month on our return from Alicante. Yes, we had 25 cartons of cigarettes each and 4 cartons of duty free (which are more expensive than what we buy in the Tobacs!)
The jobsworth kept on and on about 16 cartons being the guideline amount - yes, we said, GUIDELINE, not maximum or anything else.
I got into a state, as I tend to, apart from anything else I was gasping for a ciggie, so the upshot was I walked out for a smoke and left hubby to deal with the obnoxious idiot!
However, even hubby was little put out when he finally came out because although, if we are lucky, we go abroad twice a year, roughly 6 to 7 months apart, he was told that if we left the country again within 6 months on our return we would be interrogated for 4 hours, not inconvenienced for half an hour or so!
Once home I contacte my MP and met him at his surgery the following weekend. He is taking up the obscene actions of this jumped up little hitler with the highest authority he can within Customs and Excise because, as he said, we had done nothing wrong, we were not criminals and he had no right to threaten and intimidate us in that way.
I have had confirmation that he has made contact, am now waiting on what response he gets on our behalf!
Seems to me that the government must be getting panicky about how much revenue they are losing, but then perhaps they didn't think about that whilst trying to denormalise us smokers!
Lyn - At last, a decent-MP story. Good for you for consulting him and I, for one, look forward to a happy outcome. If I went abroad, I can imagine my holiday being spoiled by the anxiety of having to justify my perfectly legal behaviour to a state-bully. Customs and Excise already have form and I hope that the MP comes down like a ton of bricks on them.
Thanks Joyce, so do I.
I am still waiting for the outcome - it was Saturday, March 7th that I saw Sir Michael Spicer and during the following week did receive a letter from him saying how he had reported the issue to the relevant, highest, relevant person/department and he would forward the response when he received it.
He has been very diligent about this in the past and I therefore do hold out a lot of hope, however it may well take the 'relevant' person/department a while to respond, no doubt their excuse being they were trying to track down and get the other side of the story from the customs officer involved!
Nevertheless, I await the response with interest and hope that it is not like other drivel received from the likes of Dawn Primolo, or whatever her name is, regarding smoking!
I will try and keep you posted.
Best of luck Lyn and do keep us posted. What is most annoying is that while this prat was quizzing you about cigarettes plainly imported for personal use, containers of cocaine, weapons, smuggled cigarettes and illegal immigrants are being brought in daily. You were just an easy target of someone who is clearly too lazy to tackle real crime.
I absolutely agree, Michael and made that same comment 'like drivers, we are just an easy target' to my husband when he finally emerged with both lots of luggage!
In truth, I possibly didn't help due to getting panicky because of the feeling of being trapped, which is one I get when 'trapped' in an area where I am not permitted to smoke.
I also made the comment, as my panic was rising, that it is ridiculous that the worst country to try and get into, certainly within Europe, is our own!
Perhaps I should quantify that last statement!
The worst country for native 'Brits' to get into or back into, is our own!
Do hope I am not had up for discrimination by using the term 'Brits'!