UK raises taxes on tobacco products

A 2.% increase in taxes on all tobacco products, in addition to a 6.% inflation adjustment, came into effect on 22 November 2023. Rolling tobacco is also subject to an additional 10TP3T tax. This policy confirms the UK government's intention to use taxation to combat smoking.

For the second time this year, the British government will raise excise duty on tobacco products. The first increase came in March 2023 ; it included a 2 % increase in excise duties and an indexation on the level of inflation (10.1 %), i.e. an increase of 12.1 %. This had brought the price of a packet of cigarettes to 14.36 pounds sterling (16.40 euros). For rolling tobacco, this increase had been 6 %, i.e. 16.1 % in total (nearly two euros), once inflation was included.

A second tax increase took place on November 22, 2023[1]. A further increase of 2 % in excise duties on tobacco products has been announced, which is in addition to the 6.1 % of inflation observed in October 2023. For rolling tobacco, this increase was 10 %, to which inflation was added, for a total of three additional euros. The average price of a packet of cigarettes reached 15.67 pounds, or 18.02 euros. In total, the price of cigarettes will have increased this year by around 20 %, while rolling tobacco has seen an increase of 34 %.

Relaunch of anti-smoking policy

These increases in tobacco prices can be understood as a form of catching up on the delay that the United Kingdom had taken on its tobacco exit program. In January 2023, a report by Cancer Research UK had in fact estimated that the United Kingdom was nine years late on its target of achieving a smoking prevalence of 5.1% among adult smokers by 2030. Smoking prevalence in the UK was 12.9% in 2022, compared to 13.3% in 2021. However, smoking remains the leading cause of preventable premature death in the country, with an estimated 74,600 deaths annually.[2].

Summoned by public health organizations, in June 2023, to also take measures to curb the vaping epidemic among young Britons, the government has decided to react. In October 2023, Prime Minister Rishi Sunak announced a major relaunch of anti-smoking policy. The aim of a tobacco-free generation in 2030 was reaffirmed, in particular by banning from 2027 the sale of tobacco to people born on or after 1 January 2009[3]The action plan not only aims to help more smokers quit smoking, but also seeks to prevent young people from starting to smoke – something that is now illustrated by the relaunch of tax policy.

The plan also includes several measures to restrict access to vaping products for young people. It is therefore planned to limit the range of flavours, regulate the packaging and presentation of products, and restrict the displays of vaping products. However, the ban on disposable electronic cigarettes ("puffs") has been ruled out, and the possibility of additional taxation of electronic cigarettes has not been confirmed.

A policy well received by health organizations

This action plan has been welcomed by public health organisations, as have the two waves of excise duty increases. However, the sustainability of these intentions remains to be seen, as the British Parliament is due for renewal at the end of 2024.

As in France, the British government has also stated that the planned tax increases will not affect drinks containing alcohol, at least until August 1, 2024, contrary to what had been announced. Jeremy Hunt, the Chancellor of the Exchequer, said he had been attentive to the arguments of the Scottish Whisky Association, which opposed this increase.[4].

Keywords: UK, excise duty, taxes, tobacco prices, tobacco-free generation

M.F.

[1] Increases to tobacco duty rates from 22 November 2023, UK Government, Policy paper, published 22 November 2023, accessed 24 November 2023.

[2] Smoking statistics, ASH Fact Sheet, October 2023, 11 p.

[3] Stopping the start: our new plan to create a smokefree generation, Department of Health and Social Care Media Centre, October 2023, 44 p.

[4] Whitehead J, By how much will cigarettes and tobacco increase? When the change will take effect, iNews, published November 22, 2023, accessed November 24, 2023.