Table 1

Tobacco-related tax changes and inflation during the study period

Budget stipulated tax changes81–87 Tax rates36 88 Inflation: 12 month
% changes*89
All tobaccoFM onlyRYO onlyFMRYO
VAT†Ad valoremSpecificSpecific
% pack price% pack price£ per 1000 sticks£ per kgCPIRPI
Budget enactment
22 April 20092% increase15.024.0114.31124.452.3−1.2
24 March 20101% above inflation‡17.524.0119.03129.593.44.4
23 March 20112% above RPIAd valorem: 24%–16.5%
Specific: 25% above RPI
+10% (total 12%) above RPI20.016.5154.95151.904.05.3
21 March 20125% above RPI20.016.5167.41164.113.53.6
20 March 20132% above RPI20.016.5176.22172.742.83.3
19 March 20142% above RPI§20.016.5184.10180.461.62.5
18 March 20152% above RPI20.016.5189.49185.740.00.9
  • *Although the RPI (a measure of private household spending from survey data) is still employed in relation to tobacco taxation changes,90 it was de-designated as a national statistic in March 2013 (10) and replaced with the CPI which meets international standards and is comparable with other European countries.91 The RPI, unlike the CPI, includes housing costs, is more volatile than the CPI and rises more quickly.92

  • †VAT (a sales tax) changes did not occur on budget days.88 Changes occurred as follows: 01.01.2010 (17.5%), 04.01.2011 (20%).

  • ‡2% above inflation for next 4 years.

  • §2% above inflation until end of next parliament.

  • CPI, Consumer Price Index; FM, factory made; RPI, Retail Price Index; RYO, roll your own; VAT, value added tax.