TMA newsTMA responds to Labour windfall tax proposal
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Tobacco smuggling & Crossborder shopping
The high tax-induced price of tobacco products in the UK has led to many smokers seeking alternative cheaper sources of cigarettes and handrolling tobacco (HRT), both legal (duty-free and crossborder shopping) and illegal (smuggling and bootlegging). HM Revenue & Customs estimate that in 2010/11 non-UK duty paid consumption (NUKDP) accounted for up to 19% of the cigarettes and 50% of the HRT smoked in the UK.
While the consumption of UK duty paid (UKDP) cigarettes and HRT has fallen since 1993, there has not been a corresponding fall in the level of total tobacco consumption or smoking due to the increase in smuggling and crossborder shopping.
The UK’s high tobacco tax policy has provided economic incentives for criminals to meet the demand that exists for cheap tobacco products. This has implications for Government revenue and for law and order. It threatens the livelihoods of many legitimate businesses, in particular independent tobacco retailers.
A ‘Disorderly Market’ in smuggled tobacco products has been created that is uncontrolled, untaxed and unaccountable.
A TMA Anti-Illicit Trade tri fold is available to download here.