Laffer Curve Strikes. Tobacco Revenue Down £2.5Bn
Discussion
https://www.telegraph.co.uk/politics/2025/03/10/ra...
14-30% of UK tobacco is now black market. Higher tobacco tax reduces revenue. Revenue down
12% in a year. OBR forecast £11.4Bn. Actual £8.8Bn. Reeves black hole gets deeper.
Actually a double whammy as non smokers live longer and cost the govt more in pensions and benefits. Tobacco revenue suspasses the cost of smoking to the NHS. So as more smokers avoid legal fags the govt loses the tax but still has the costs.
https://iea.org.uk/publications/smoking-and-the-pu...
14-30% of UK tobacco is now black market. Higher tobacco tax reduces revenue. Revenue down
12% in a year. OBR forecast £11.4Bn. Actual £8.8Bn. Reeves black hole gets deeper.
Actually a double whammy as non smokers live longer and cost the govt more in pensions and benefits. Tobacco revenue suspasses the cost of smoking to the NHS. So as more smokers avoid legal fags the govt loses the tax but still has the costs.
https://iea.org.uk/publications/smoking-and-the-pu...
Edited by irc on Tuesday 11th March 08:39
Is it not just down to revenue, down to trying to wean the population off smoking because they tend to lead longer, happier lives ?
Customs and Excise have the job of avoiding the illegal tobacco coming in.
Wonder how many new smokers start every year on actual cigarettes ?
It does need to be consigned to history really, one of those things that if you dont ever have, you dont miss.
Customs and Excise have the job of avoiding the illegal tobacco coming in.
Wonder how many new smokers start every year on actual cigarettes ?
It does need to be consigned to history really, one of those things that if you dont ever have, you dont miss.
For starters, I wouldn't believe anything the 'Institute for Economic Affairs' publishes.
They are nothing more than a right-leaning lobby group. They lobby and campaign for stuff like zero hour contracts, privatising the NHS and making it a paid-for service, tax havens, more unpaid internships for business, etc. They also pushed hard for Brexit. They lobby against any restrictions on smoking or unhealthy foods, clean energy projects, Unions, workers rights, and so on.
They refuse to say who funds them, yet... and this won't surprise you, they were discovered to be significantly funded by British American Tobacco, every year since 1963. They are also funded by Imperial Brands Tobacco PLC.
https://www.tobaccotactics.org/article/iea-history...
Also, the concept of smokers paying in more than they cost is simply nonsense. Look at any research from any non-tobacco lobbying group and you will find the real figures. It isn't just the cost to the NHS either, it's the cost to society in other ways such as lost days of work due to smoking related illness, and the cost of people claiming benefits due to smoking related issues.
https://humberandnorthyorkshire.org.uk/cost-of-smo...
https://fullfact.org/health/farage-smoking-revenue...
https://ash.org.uk/media-centre/news/press-release...
It's even stuff like smokers causing almost 8% of all fires in the UK annually, at a cost of nearly £400m.
https://www.kentonline.co.uk/kent/news/smoking-cos...
They are nothing more than a right-leaning lobby group. They lobby and campaign for stuff like zero hour contracts, privatising the NHS and making it a paid-for service, tax havens, more unpaid internships for business, etc. They also pushed hard for Brexit. They lobby against any restrictions on smoking or unhealthy foods, clean energy projects, Unions, workers rights, and so on.
They refuse to say who funds them, yet... and this won't surprise you, they were discovered to be significantly funded by British American Tobacco, every year since 1963. They are also funded by Imperial Brands Tobacco PLC.
https://www.tobaccotactics.org/article/iea-history...
Also, the concept of smokers paying in more than they cost is simply nonsense. Look at any research from any non-tobacco lobbying group and you will find the real figures. It isn't just the cost to the NHS either, it's the cost to society in other ways such as lost days of work due to smoking related illness, and the cost of people claiming benefits due to smoking related issues.
https://humberandnorthyorkshire.org.uk/cost-of-smo...
https://fullfact.org/health/farage-smoking-revenue...
https://ash.org.uk/media-centre/news/press-release...
It's even stuff like smokers causing almost 8% of all fires in the UK annually, at a cost of nearly £400m.
https://www.kentonline.co.uk/kent/news/smoking-cos...
Edited by Mont Blanc on Tuesday 11th March 08:54
Ciggy companies do have a vested interest in it as it's not product running through their books. Governments have to choose which devil they like the most - big tobacco or organised crime. Where I am (Melbourne, Australia) there's a turf war going on in the illicit ciggy trade and BAT estimates 28.6% of the market is illicit. When the market in the UK gets lucrative enough you might end up with the fun and games.
https://www.theguardian.com/society/2024/nov/02/bu...
google "melbourne tobacco wars".
https://www.theguardian.com/society/2024/nov/02/bu...
google "melbourne tobacco wars".
irc said:
https://www.telegraph.co.uk/politics/2025/03/10/ra...
14-30% of UK tobacco is now black market. Higher tobacco tax reduces revenue. Revenue down
12% in a year. OBR forecast £11.4Bn. Actual £8.8Bn. Reeves black hole gets deeper.
Actually a double whammy as non smokers live longer and cost the govt more in pensions and benefits. Tobacco revenue suspasses the cost of smoking to the NHS. So as more smokers avoid legal fags the govt loses the tax but still has the costs.
https://iea.org.uk/publications/smoking-and-the-pu...
To be clear - you're suggesting that the tax on tobacco should reduce, in order to boost Government tax revenue?14-30% of UK tobacco is now black market. Higher tobacco tax reduces revenue. Revenue down
12% in a year. OBR forecast £11.4Bn. Actual £8.8Bn. Reeves black hole gets deeper.
Actually a double whammy as non smokers live longer and cost the govt more in pensions and benefits. Tobacco revenue suspasses the cost of smoking to the NHS. So as more smokers avoid legal fags the govt loses the tax but still has the costs.
https://iea.org.uk/publications/smoking-and-the-pu...
Edited by irc on Tuesday 11th March 08:39
Do you also think that the Government should be encouraging smoking to ease pressure on the NHS, pension and benefit systems that you specify are under further burden?
Yertis said:
A good friend of mine - 60 ish - refuses to give up smoking specifically so he doesn’t have a slow lingering old age / death by numbers, like his Dad.
Of course he might still have those things, but he’s stacking the odds in his favour.
I find this topic quite interesting. i.e. If living an unhealthy lifestyle means avoiding an unhappy old age? Or does it just make all that stuff happen when younger?Of course he might still have those things, but he’s stacking the odds in his favour.
Last year I did a cheap trip to Agadir - £28 return for 2 days...
The chavvy woman sat next to me on the plane was buying "baccy" - and she bought a lot. It was her 22nd cheap trip that year and the sole purpose was to buy baccy to sell. It paid for her own smoking habbit of 20 per day and she made a profit even after paying for flights and Air B&B... In all of her trips customs had stopped her once and the choice was pay the duty or forfeit.
I had no idea how much cigarettes now cost and was suprised that they are now about £1 per cigarette!
Turns out if you raise the duty too high some people will make a living by taking cheap holidays and tobacco smuggling
The chavvy woman sat next to me on the plane was buying "baccy" - and she bought a lot. It was her 22nd cheap trip that year and the sole purpose was to buy baccy to sell. It paid for her own smoking habbit of 20 per day and she made a profit even after paying for flights and Air B&B... In all of her trips customs had stopped her once and the choice was pay the duty or forfeit.
I had no idea how much cigarettes now cost and was suprised that they are now about £1 per cigarette!
Turns out if you raise the duty too high some people will make a living by taking cheap holidays and tobacco smuggling
Edited by jesusbuiltmycar on Tuesday 11th March 09:48
Yertis said:
A good friend of mine - 60 ish - refuses to give up smoking specifically so he doesn’t have a slow lingering old age / death by numbers, like his Dad.
Of course he might still have those things, but he’s stacking the odds in his favour.
If he wants to die 20 years earlier whilst coughing his guts up then fine I guess. That's definitely winning...Of course he might still have those things, but he’s stacking the odds in his favour.
£15 a packet retail. Keeps the smuggled in workers in remote sheds in the fens manufacturing fake snouts at 20p a packet and the addicts buying them for £4 happy.
And safer than other, more illegal drugs - for the producer.
From a couple of years ago.
https://www.bbc.co.uk/news/uk-england-leicestershi...
https://www.northumbria.police.uk/news/northumbria...
And safer than other, more illegal drugs - for the producer.
From a couple of years ago.
https://www.bbc.co.uk/news/uk-england-leicestershi...
https://www.northumbria.police.uk/news/northumbria...
Yertis said:
A good friend of mine - 60 ish - refuses to give up smoking specifically so he doesn’t have a slow lingering old age / death by numbers, like his Dad.
Of course he might still have those things, but he’s stacking the odds in his favour.
He might not like it if / when his lungs clog up and he can't breathe so good.Of course he might still have those things, but he’s stacking the odds in his favour.
TX.
Mont Blanc said:
For starters, I wouldn't believe anything the 'Institute for Economic Affairs' publishes.
They are nothing more than a right-leaning lobby group. They lobby and campaign for stuff like zero hour contracts, privatising the NHS and making it a paid-for service, tax havens, more unpaid internships for business, etc. They also pushed hard for Brexit. They lobby against any restrictions on smoking or unhealthy foods, clean energy projects, Unions, workers rights, and so on.
They refuse to say who funds them, yet... and this won't surprise you, they were discovered to be significantly funded by British American Tobacco, every year since 1963. They are also funded by Imperial Brands Tobacco PLC.
https://www.tobaccotactics.org/article/iea-history...
Yup.They are nothing more than a right-leaning lobby group. They lobby and campaign for stuff like zero hour contracts, privatising the NHS and making it a paid-for service, tax havens, more unpaid internships for business, etc. They also pushed hard for Brexit. They lobby against any restrictions on smoking or unhealthy foods, clean energy projects, Unions, workers rights, and so on.
They refuse to say who funds them, yet... and this won't surprise you, they were discovered to be significantly funded by British American Tobacco, every year since 1963. They are also funded by Imperial Brands Tobacco PLC.
https://www.tobaccotactics.org/article/iea-history...
Handy chart of transparency funding here https://www.opendemocracy.net/en/who-funds-you/
Organisation that is paid for by tobacco is unsurprisingly in favour of reducing tobacco taxation. Shocked, I tell you.
Muzzer79 said:
irc said:
https://www.telegraph.co.uk/politics/2025/03/10/ra...
14-30% of UK tobacco is now black market. Higher tobacco tax reduces revenue. Revenue down
12% in a year. OBR forecast £11.4Bn. Actual £8.8Bn. Reeves black hole gets deeper.
Actually a double whammy as non smokers live longer and cost the govt more in pensions and benefits. Tobacco revenue suspasses the cost of smoking to the NHS. So as more smokers avoid legal fags the govt loses the tax but still has the costs.
https://iea.org.uk/publications/smoking-and-the-pu...
To be clear - you're suggesting that the tax on tobacco should reduce, in order to boost Government tax revenue?14-30% of UK tobacco is now black market. Higher tobacco tax reduces revenue. Revenue down
12% in a year. OBR forecast £11.4Bn. Actual £8.8Bn. Reeves black hole gets deeper.
Actually a double whammy as non smokers live longer and cost the govt more in pensions and benefits. Tobacco revenue suspasses the cost of smoking to the NHS. So as more smokers avoid legal fags the govt loses the tax but still has the costs.
https://iea.org.uk/publications/smoking-and-the-pu...
Edited by irc on Tuesday 11th March 08:39
Do you also think that the Government should be encouraging smoking to ease pressure on the NHS, pension and benefit systems that you specify are under further burden?
I don’t think it’s really the Laffer curve in action because surely the point of such high duty on tobacco is try to discourage people from using it.
My limited understanding of the Laffer curve is that’s it’s about raising taxes on the wealthy with the aim of raising tax revenue and there being a tipping point where those people choose to leave. The aim isn’t to make them leave.
Subtly different.
Anyway, time for a 300% duty on vapes?
My limited understanding of the Laffer curve is that’s it’s about raising taxes on the wealthy with the aim of raising tax revenue and there being a tipping point where those people choose to leave. The aim isn’t to make them leave.
Subtly different.
Anyway, time for a 300% duty on vapes?
Muzzer79 said:
To be clear - you're suggesting that the tax on tobacco should reduce, in order to boost Government tax revenue?
Do you also think that the Government should be encouraging smoking to ease pressure on the NHS, pension and benefit systems that you specify are under further burden?
I'd suggest reducing the tax rate to increase the tax take. I'd rsther smokers paid tax than used blackmarket fags.Do you also think that the Government should be encouraging smoking to ease pressure on the NHS, pension and benefit systems that you specify are under further burden?
As for reducing smoking rates? As the only person harmed is the smoker it is none of the govts business. Put out the facts and let people decide for themselves.
The fact it would boost revenue would be a happy bonus.
Mont Blanc said:
Also, the concept of smokers paying in more than they cost is simply nonsense. Look at any research from any non-tobacco lobbying group and you will find the real figures. It isn't just the cost to the NHS either, it's the cost to society in other ways such as lost days of work due to smoking related illness, and the cost of people claiming benefits due to smoking related issues.
Any increased sick days will be more than balanced by smokers dying years early and not needing years of medical care in old age and receiving benefits/OAP for fewer years.A Finnish study confirms smoker are a net benefit the taxpayer. It only turnsd into a loss when a value is placed on years of quality life lost. That is not a cost to the taxpayer though.
"Results Smoking was associated with a greater mean annual healthcare cost of €1600 per living individual during follow-up. However, due to a shorter lifespan of 8.6 years, smokers’ mean total healthcare costs during the entire study period were actually €4700 lower than for non-smokers. For the same reason, each smoker missed 7.3 years (€126 850) of pension. Overall, smokers’ average net contribution to the public finance balance was €133 800 greater per individual compared with non-smokers."
https://bmjopen.bmj.com/content/2/6/e001678
paulw123 said:
Yertis said:
A good friend of mine - 60 ish - refuses to give up smoking specifically so he doesn’t have a slow lingering old age / death by numbers, like his Dad.
Of course he might still have those things, but he’s stacking the odds in his favour.
If he wants to die 20 years earlier whilst coughing his guts up then fine I guess. That's definitely winning...Of course he might still have those things, but he’s stacking the odds in his favour.
Randy Winkman said:
paulw123 said:
Yertis said:
A good friend of mine - 60 ish - refuses to give up smoking specifically so he doesn’t have a slow lingering old age / death by numbers, like his Dad.
Of course he might still have those things, but he’s stacking the odds in his favour.
If he wants to die 20 years earlier whilst coughing his guts up then fine I guess. That's definitely winning...Of course he might still have those things, but he’s stacking the odds in his favour.
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