The price of a packet of 20 cigarettes will rise by an average of 95 pence from 6pm on Wednesday as part of measures announced in the spring Budget.
Chancellor Jeremy Hunt announced all tobacco products will increase by 2 per cent above RPI and hand-rolling tobacco by 6 per cent above RPI. The changes add 95p to the price of a packet of 20 cigarettes, £1.75 to a 30g packet of hand-rolling tobacco, 48p to a 10g packet of cigars, 63p to a 30g packet of pipe tobacco and 24p to tobacco for heating packs, according to figures provided by Action on Smoking and Health (Ash).
The Minimum Excise Tax (MET) on cigarettes and the price at which it applies has been uprated by an additional 1 per cent to 3 per cent above RPI. The new MET will be £7.87, rising from £6.96 for a packet of 20 and will apply to cigarettes sold at or below £11.97 – having previously been £10.30.
While Mr Hunt did not comment directly on the rising cost of cigarettes, the move is likely to be welcomed by health groups that would be glad of any disincentive for smokers.
The government is pushing for the UK to be “smoke free” by 2030.
An Ash statement said: “Action on Smoking and Health and the Spectrum public health research consortium welcomed today’s increase in tobacco taxes of 2 per cent above inflation for cigarettes. For this year that will mean a 95p increase on a pack of 20 cigarettes. 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.”
The statement added: “However, we are disappointed that the Chancellor did not accept our recommendation to change from RPI to average earnings as the foundation for the tobacco tax escalator. RPI is not a good measure of affordability particularly at the current time when wages are not keeping pace with inflation.”
Simon Clark, director of the smokers’ group Forest, said: “Punishing smokers for their habit during a cost of living crisis is heartless and cruel. It discriminates against poorer smokers and will drive many more consumers to the black market. This is bad news for legitimate, law-abiding retailers, and bad news for the Treasury, which could lose billions of pounds in revenue if more smokers buy their tobacco from illicit traders.”
Mr Hunt also announced that alcohol would rise in line with the Retail Price Index in supermarkets, although in pubs a guarantee will ensure pints of draught beer cost an average of 11p less than their equivalent in shops.
Other measures announced as part of the budget included the extension of the energy price guarantee, which can save households up to £160 a year. Fuel duty was frozen and the lifetime allowance on pensions will be axed, and benefits will rise.
Mr Hunt said: “Our plan is working – inflation falling, debt down and a growing economy. Britain is on a lasting path to growth with a revolution in childcare support, the biggest ever employment package and the best investment incentives in Europe.”
Today, Jeremy Hunt should've matched the ambition of the British people.
— Keir Starmer (@Keir_Starmer) March 15, 2023
Unlocked pride in every community.
Brought us together with purpose and intent.
All we got was sticking plaster politics.
Only Labour will deliver the long-term solutions our country needs. pic.twitter.com/M5bJUjuWGU
Keir Starmer, the leader of the opposition, said: “Today, Jeremy Hunt should’ve matched the ambition of the British people. Unlocked pride in every community. Brought us together with purpose and intent. All we got was sticking plaster politics. Only Labour will deliver the long-term solutions our country needs.”
