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Tobacco And Tobacco Products (Duty)

Volume 982: debated on Tuesday 15 April 1980

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asked the Chancellar of the Exchequer by what percentage the duty on tobacco would have to be raised, and what would be the extra cost of 20 cigarettes, in order to yield the cost of an increase in child benefit at £5 per week in a full year, instead of £4·75 as proposed.

[pursuant to his reply, 14 April 1980]; The specific duties on tobacco would have to be increased by a further 9 per cent. which, with VAT, would add about 3½p to the price of 20 cigarettes.

asked the Chancellor of the Exchequer by what percentage his proposals for the increases in duties on tobacco products will raise those duties since the date when the previous rates were fixed and what the increase would be if the changes corres ponded to the depreciation in the purchasing power of the £ sterling since the same date.

[pursuant to his reply, 14 April 1980]. The information is as follows:

Budget proposalTo maintain real value since last increase*
Hand rolling tobacco11·438
Pipe tobacco8·144
* Movement of retail price index between January/April 1977 and February 1980.
† Increase over specific duty fixed August 1979. (Since the last substantive increase in duty rates in April 1977, the duty on cigarettes has been restructured and its specific and ad valorem elements subsequently varied; comparisons over the whole period are complicated also by the interaction of VAT with the tobacco duty. However, it is estimated that after the implementation of the Budget proposals the total duty on a typical packet of cigarettes is about 22 per cent. above that in April 1977.)