Smokers feel the pinch: Pack of cigarettes goes up by 88p to £13.60 TODAY after Chancellor hiked tobacco tax
A pack of cigarettes now costs more than £13 after the Chancellor decided to increase tobacco tax.
The most expensive 20-pack jumped by 88p to £13.60 while the cheapest pack rose by 63p to £9.73, , according to Rishi Sunak’s Budget yesterday.
People have taken to Twitter to voice their frustration, with one branding the cost 'ridiculous'.
A 20 pack of cigarettes now costs more than £13 after the Chancellor decided to increase tobacco tax
The most expensive 20-pack jumped by 88p to £13.60 while the cheapest pack rose by 63p to £9.73
Others pointed out that the price of cigarettes had been hiked while at the same time taxes on some alcoholic drinks such as prosecco and cider were lowered.
Another wrote: 'So the cost of cigarettes is rising again. Let's not pretend this is about health.
'Fact of the matter is even after taking into account how much the NHS spend on smoking related illness and disease the UK government make almost 15 billion pounds each year'.
Amanda Wardlaw tweeted: 'Have no idea what price my fags are and am no looking forward to finding out'.
Hand-rolling tobacco will increase by RPI plus 6 per cent meaning a 30g bag will now cost over £9.02
People have taken to Twitter to voice their frustration, with one user branding the higher cost 'as ridiculous'
Duty rates on all tobacco products will increase by the Retail Price Index measure of inflation plus 2 per cent, Chancellor Rishi Sunak announced.
Hand-rolling tobacco will increase by RPI plus 6 per cent meaning a 30g bag will now cost over £9.02.
The minimum excise tax will go up by RPI plus 3 per cent. The changes came into effect at 6pm last night.
Ministers hope that the move will reduce the number of people smoking.
Pints will STILL get more expensive: Pub bosses warn Chancellor's five per cent beer duty cut will only 'take top off' 30p price rise as industry is squeezed by supply chain crisis
- Jonathan Neame, CEO of Shepherd Neame, said his firm would pass on 3p-a-pint duty cut on wholesale sales
- But he said that 'in all honesty' pubs face pint inflation of 25 to 30p and move will only 'take the top off' that
- Rishi Sunak also announced a planned increase to the duty on spirits, wine, cider and beer will be cancelled
By Rory Tingle, Home Affairs Correspondent and Jack Maidment, Deputy Political Editor for MailOnline
Pints will still get more expensive even after the Chancellor's five per cent beer duty cut - with a pub boss warning it would only 'take the top off' a 30p-per-pint price rise due to rising inflation.
Jonathan Neame, chief executive of Shepherd Neame, said the company would pass on the 3p-a-pint duty cut on kegs it sells wholesale to landlords but drinkers are unlikely to see the benefits.
Pubs are already being clobbered by raising gas prices, supply chain pressures and shortages of bar staff and delivery drivers. More than eight in 10 have already raised prices or are planning to do so in the near future.
There was also anger today that the duty cut will only affect 40l kegs, not the 30l ones used by craft breweries. Campaigners fear fears big brewers will simply gobble up the savings rather than pass them on to pubs.
MailOnline today contacted Britain's five biggest pub chains to ask if they will be passing on the beer duty reduction to drinkers.
In his Budget, Rishi Sunak also said a planned increase to the duty on lower-strength spirits, wine, cider and beer will be cancelled while the 'irrational' 28% duty on fruit ciders premium sparkling wines like prosecco will be cut.
Drinks that will see taxes reduced include Bailey's (41p a bottle), Gordon's gin (9p per can), and Canti prosecco (87p per bottle). The tax take on beers like Stella and Carling will remain the same in shops but dip by 3p in pubs.
But other beverages will see increases, including Cockburn's port (£1.09 per bottle), Hardy's merlot (35p per bottle) and Scottish favourite Buckfast (81p per bottle). It remains to be seen if retailers will pass any savings on.
In addition to the beer duty cut, Rishi Sunak also announced a planned increase to the duty on lower-strength spirits, wine, cider and beer will be cancelled. The changes will see the tax take increase on some drinks and decrease on others
The Chancellor joined Boris Johnson at Fourpure Brewing Co in Bermondsey, London yesterday afternoon for a publicity stunt to promote the cut to beer duty. However, eagle-eyed critics spotted that they were lifting 30-litre kegs. Only 40-litre ones will be subject to the duty cut. 'This misses a huge amount of the craft beer industry,' a brewery founder told the Guardian Responding to Mr Sunak's Budget announcements, Mr Neame told Radio 4's Today programme: 'We will pass on the duty cut at a wholesale, but in all honesty, pubs are facing between 25 to 30p per pint inflation and this will do will take the top off that.
'It will reduce the rate of increase, but there is roughly 14% inflation impacting most hospitality businesses, so while I'd love to say the price of beer come down its very hard to see that because a lot of inflation is still coming down the track in terms of energy and food etc.
'At the moment there are terrific supply chain squeezes that most people anticipate will last for six to nine months, and hopefully afterwards inflation will start to ease off.'
Most pubs will also benefit from £7billion worth of cuts to business rates, including the cancellation of next year's increase in the rates multiplier and a 50% cut in the total bill.
Mr Neame welcomed the move but argued there was more to be done.
'It won't help Shepherd Neame so much as a multi-site operator but it will help our tenanted licensees which are two-thirds of our pubs,' he said. 'It's a great benefit for them, and it's also a great benefit because it stimulates investment - as before rates would go up when you invested.
'I think what has been missed here though is the chance for fundamental reform on rates. This is a medieval tax that doesn't balance out the overall economic activity between the digital and non-digital world, and too much is being borne but hospitality and retail at the moment.'
The teetotal Chancellor used his Budget to set out a new Draught Relief policy which will see beer and cider duty reduced by five per cent.
He said that amounted to the biggest cut on the tax on beer in 50 years and the 'biggest cut to cider duty since 1923'.
He also announced a planned increase to the duty on spirits, wine, cider and beer will be cancelled while the 'irrational' 28 per cent duty on premium sparkling wines like prosecco and fruit ciders will be cut.
However, the Chancellor's plan to simplify the alcohol duty system - which he said was made possible by Brexit - will see some drinks become more expensive, with red wine drinkers among those hit.
Mr Sunak said that under his new system - which will be rolled out in February 2023 - the stronger the drink, the higher the rate of tax will be.
That will also mean less-strong drinks like rose wine and liqueurs, which are currently 'over taxed', will become cheaper.
Mr Sunak and the Prime Minister Boris Johnson marked the announcements by visiting Fourpure Brewing Company in Bermondsey, central London, as they poured pints and saw the brewing process.
Hospitality bosses welcomed the changes announced by Mr Sunak.
They said pubs, brewers and beer drinkers 'will be toasting the Chancellor' for bringing forward a 'range of business-boosting measures'.
Emma McClarkin, chief executive of the British Beer and Pub Association, said: 'Pubs, brewers and beer drinkers will be toasting the Chancellor today for a range of business-boosting measures.
'Pub goers will also be toasting the Chancellor for announcing a five per cent lower duty rate on draught beer worth £62million.
'This is great news for our local pubs and recognises the crucial role they play in our economy and society.
'However, the overall beer duty rate in the UK remains amongst the highest in Europe.
'It is vital for Britain's brewers, a world class homegrown manufacturing success story, that the overall beer duty burden is reduced – not just duty on draught beer in pubs.'
Mr Sunak said that under his new system - which be rolled out in February 2023 - the stronger the drink, the higher the rate of tax will be
The Chancellor said the Draught Relief amounts to the biggest cut on the tax on beer in 50 years and the 'biggest cut to cider duty since 1923'The Chancellor told MPs that the existing alcohol duty system in the UK is 'outdated, complex and full of historical anomalies'.
He said his overhaul will deliver the 'most radical simplification of alcohol duties for over 140 years', resulting in a 'simpler, fairer and healthier' system.
Mr Sunak said Brexit made the shake-up possible, telling the Commons the Government is 'taking advantage of leaving the EU' by rolling out a raft of changes.
The changes will see the overall number of alcohol duties reduced from the current 15 to just six.
Mr Sunak said the new system will be guided by a 'common sense principle' of 'the stronger the drink, the higher the rate'.
He said: 'This means that some drinks, like stronger red wines, fortified wines or high strength white ciders will see a small increase in their rates because they are currently undertaxed given their strength.
'That is the right thing to do and will help end an era of cheap high strength drinks which can harm public health and enable problem drinking.'
The Chancellor said the 'converse is also true' for alcoholic drinks which are not as strong.
He said: 'Many lower alcohol drinks are currently over taxed and have been for many decades.
'Rose. Fruit ciders. Liqueurs. Lower strength beers and wines. The changes mean that they will pay less.'
Mr Sunak said that drinking habits in the UK had changed, with more people now consuming sparkling wines as he moved to make them cheaper.
He told MPs: 'Over the last decade, consumption of sparkling wines like Prosecco has doubled. English sparkling wine has increased tenfold. It is clear they are no longer the preserve of wealthy elites.
'And they are no stronger than still wines so I am going to end the irrational duty premium of 28 per cent that they currently pay.
'Sparkling wines wherever they are produced will now pay the same duty as still wines of equivalent strength.'
Mr Sunak had been under pressure from Tory MPs to bring forward help for struggling pubs.
Many Conservative MPs had been calling for a reduction in beer duty and Mr Sunak obliged as he announced his new 'Draught Relief' policy.
Hospitality bosses welcomed the changes as they said pubs, brewers and beer drinkers 'will be toasting the Chancellor' for bringing forward a 'range of business-boosting measures'
Bottles of Rose wine will see tax bills slashed. The tax applied to a bottle of Echo Falls Zinfandel will be 23p lower
'Draught Relief will apply a new, lower rate of duty on draught beer and cider.
'It will apply to drinks served from draught containers over 40 litres. It will particularly benefit community pubs who do 75 per cent of their trade on draught.
'And let me tell the House the new rate: Draught Relief will cut duty by five per cent.
'That is the biggest cut to cider duty since 1923, the biggest cut to fruit ciders in a generation, the biggest cut to beer duty for 50 years.
'This is not temporary, it is a long term investment in the British pubs of £100million a year and a permanent cut in the cost of a pint of 3p.'
He added: 'These much needed reforms will come into effect in February 2023.'
Miles Beale, chief executive of the Wine and Spirit Trade Association, welcomed the decision to freeze wine and spirit duty.
He said: 'The decision to freeze wine and spirit duty comes as a huge relief to British businesses, the hospitality sector – including its supply chain – and consumers, giving everyone a much-needed break to help them recover from the pandemic.
'Chancellor Rishi Sunak should be commended for listening to our calls for support and understanding that punishing tax hikes are not the best way to reinvigorate the sector.
'By offering continued respite to the UK wine and spirit sector his actions will help save jobs and – in time – replenish revenues to the Treasury through growth in our potential-filled sector.'
Jez Lamb, founder of the Wirral-based craft beer marketplace Beers@No.42, questioned whether the shake-up will benefit smaller breweries.
He said: 'The devil's always in the detail. It's brilliant to see alcohol duty cut on draught beer but that's only for 'containers' more than 40L.
'This is great for the big breweries but so many smaller craft brewers only supply in 30L containers.
'This just further supports the big players in the market, not supporting the smaller, independent breweries who need support most.'
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