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UK survey finds high retail prices driving consumers to illegal tobacco

By October 27, 2017February 1st, 2018No Comments

A new survey has found that some smokers in the UK are spending £1,000 per year on illegal tobacco, Talking Retail reported yesterday. In launching the anti-illicit trade survey, Giles Rosa, director general of the Tobacco Manufacturers Association, highlighted to UK Members of Parliament the recent rise in the sale of illegal tobacco in the UK, and called on the government to freeze tobacco duty and to crack down on people bringing in cheap tobacco from abroad.

Rosa said the high price of tobacco in shops was the main reason behind the rise in illegal trade. Illegal tobacco prices are around half that of legal duty-paid products, and the illicit trade is booming, he added. “It is increasingly a justification for people to think it is OK to avoid tax because the tax is so high. That’s a very dangerous position for public policy makers to be in,” Rosa said.

ESTA supports sensible tax policies which safeguard revenues and protect consumers from illegal tobacco. Fine-cut tobacco performs an essential function in this context: lower duties on fine-cut tobacco allow it to act as a buffer between higher price cigarettes and the illegal market. Sales of illegal products mean that governments and citizens lose out on tax revenue, which instead flows into the hands of criminals and gangs.

The buffer function of fine-cut tobacco is an incredibly important tool for policy makers in the fight against illegal trade,” ESTA Secretary General Peter van der Mark said. “This UK survey clearly shows how widespread and insidious the problem of illegal tobacco smuggling is, and why it is vital for policy makers to take action on illegal trade.”

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