Budget 2012: Tobacco Duty Increase To Add 37p To Price Of Cigarettes

Posted: 21/03/2012 13:24 Updated: 21/03/2012 14:50

Cigarette Tax

Tobacco duty will rise 5% above inflation - adding a massive 37p on packets of cigarettes from 6pm this evening, the government announced today.

In his 2012 budget Chancellor George Osborne said smoking was the biggest cause of "premature death" in Britain:

"Turning to tobacco duty.

"Smoking remains the biggest cause of preventable illness and premature death in the UK," he told the House of Commons.

"There is clear evidence that increasing the cost of tobacco encourages smokers to quit and discourages young people from taking it up.

"So duty on all tobacco products will rise by 5 percent above inflation. That’s 37 pence on a packet of cigarettes. This will take effect at 6pm tonight."

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However the Chancellor confirmed that one so-called 'sin tax', alcohol duty would not be changed - however the Treasury said rates will increase by 2% above RPI inflation, so prices will rise by 5% from next week.

"The government will shortly be publishing its Alcohol Strategy to address the growing problem of alcohol abuse, and the many billions of pounds it costs our NHS and criminal justice system.

"But today I have no further changes to make to the duty rates set out by my predecessor."

ASH (Action on Smoking and Health) chief executive Deborah Arnott said: "This is excellent news. Raising the price of tobacco through taxation is the most effective way of encouraging smokers who want to quit to make that first step.

"We are delighted that the Chancellor has listened to the voices of the health community and taken decisive action to tackle the greatest single cause of ill health and premature death.

"This tax rise will also put cigarettes out of the price range of many young people making it less likely that they will take up this lethal habit."

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Filed by Dina Rickman  |