Philip Hammond's budget to hit smokers as price of pack of cigarettes will cost at least £8.82

A new minimum excise tax will raise prices of the cheapest cigarettes

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British smokers have been hit by Chancellor Philip Hammond’s budget with the cost of a pack of cigarettes rising to a least £8.81.

Mr Hammond on Wednesday  told MPs there would be no change to “previously planned upratings of duties on alcohol”.

This really means that tobacco duty will increase at two per cent above inflation under planned price hikes first announced in 2014, leaving a packet of 20 cigarettes costing an additional 35p.

A 30g pack of rolling tobacco is increasing 42p.

A new minimum excise duty is also separately being introduced on cigarettes from the 20th May based on a packet price of £7.35, meaning that smokers will not be able to buy a pack of cigarettes for less than £8.82.

“Taxation on tobacco in the UK is already the highest in the EU meaning that prices in the UK are up to four times higher than in other European countries,” Giles Roca, director general of the Tobacco Manufacturers’ Association (TMA), said.

Taxation on tobacco is part of a series of so-called “sin taxes” which will also see the duty on beer, cider, wine and spirits  increase in line with Retail Price Index (RPI) inflation.

According to the Wine and Spirit Trade Association (WSTA), a bottle of wine will go up by 8p, sparkling wine 10p and an average priced bottle of spirits will shoot up 30p.

Miles Beale ,chief executive of the WSTA said: “It is disappointing that the Chancellor has failed to support a great British industry. He has increased what were already excessive and unfairly high rates of duty for the UK’s wine and spirit consumers and businesses.

“Between Brexit’s impact on the pound and rising inflation the wine and spirit businesses face a tough trading landscape. This is a missed opportunity to back British business and help out struggling consumers.”

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