In response to recent reports that rolling tobacco is now more valuable per gram than some precious metals such as silver, Imperial Brands is encouraging retailers to ask their local MP to rethink excessive levels of excise applied to tobacco products to avoid an upsurge in crime and abuse against retailers.
Last November’s budget applied a Recommended Price Index (RPI) + 12 per cent excise rate on hand rolling tobacco products in the UK.
The UK now has the highest excise duty in Europe – six times higher than in Spain, and five times higher than in Germany.
Andrew Malm, UK Market Manager for Imperial Brands, said, “We now have a situation whereby hand rolling tobacco is more valuable per gram than silver, making local retailers and convenience store owners in the UK as much of a target to thieves as jewellery stores.
“Not only does this taxation drive UK consumer spending elsewhere – as, for example, a 30g pouch of rolling tobacco is now four times more expensive in the UK compared to Spain – but it also contributes to the issue of retail crime and illicit trade.
“This excessive excise duty will further incentivise organised criminal gangs to produce hand rolling tobacco illegally and sell the product through illicit channels here in the UK. Illicit trade is already a significant issue, and one which ultimately impacts on retailers and their revenue.
“As a responsible manufacturer, we will continue to engage with the Government to re-assess the current excise duty on these products as it poses a significant threat to retailers’ livelihoods and contributes to an already growing illicit market.
"We would also encourage retailers to reach out to their local MPs and councillors, ensuring that the issues their businesses are facing are highlighted and heard by relevant public officials.”
Malm's plea comes weeks after a report stated that the cost of tobacco has turned convenience stores into targets for organised crime, as it is now worth more than silver per gram.
Successive tax hikes on rolling tobacco means that a 50g pouch of Amber Leaf now costs 87p a gram – compared to 83p for silver.
It has encouraged gangs to target not only stores but also delivery vans, adding to the wave of crime hitting the retail sector.
Experts say that criminals regard tobacco theft as a low-risk, high-reward crime because the products are ‘concealable, removable and available’.
As part of Chancellor Rachel Reeves’s plan to boost the public finances, the Treasury is considering doubling the tax on tobacco – which the industry argues would further fan the black market.
The Treasury is estimated to have lost more than £50 billion in tax revenue on tobacco to the black market since 2000.
