Autumn Statement – what is happening to booze and cigarette prices after Jeremy Hunt’s statement
CHANCELLOR Jeremy Hunt has laid out his plans for economic recovery in his autumn statement today.
Jeremy Hunt today announced a range of tax rises and spending cuts aimed at resorting stability after Liz Truss’ disastrous mini-budget.
But there were little changes to booze and cigarette tax.
Here, we explain what will happen to beer and cigarette prices following today’s autumn statement.
Will the price of cigarettes go up?
Smokers won’t have to pay more for a pack of cigarettes as Chancellor Jeremy Hunt didn’t announce plans to hike rates in his announcement today.
A hike wasn’t expected as the duty is usually changed in the Spring Budget.
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Tobacco duty is a tax charged to companies making or importing cigarettes in the UK.
When the tax is raised, the cost is passed on to consumers who have to pay more for tobacco products in the shops.
Cigarette prices were last hiked in October last year, when 88p was added to the most expensive packs of fags, increasing their cost from £12.73 to just over £13.60.
The cheapest 20 packs jumped by 63p from £9.10 to £9.73.
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According to the Office for Budget Responsibility, the Treasury raised a hefty £9.7 billion from tobacco duties in the 2019/20 tax year.
Will the price of alcohol go up?
Today’s Autumn Statement, confirmed that tax on spirits like gin and whisky will go up by 12.6% RPI next Spring.
This will be the biggest rise since the duty was first brought in in 1643.
The increase was first introduced by then-Chancellor Rishi Sunak last year, with today’s budget confirming that it will go ahead.
This will reportedly vendors with just £3.50 after tax from the average £15.34 bottle to pay suppliers, wages and cover business costs.
Ex-Chancellor Kwasi Kwarteng announced plans to freeze booze duties from February 2023 at September’s mini-Budget. But his successor Jeremy Hunt cancelled that when he took over.
Now without an invention from the Treasury, the crippling hike will hit producers and drinkers within months.
Drinks will be taxed in proportion to their alcohol content, with beer having a lower alcohol content than a number of other popular boozy beverages.
Other lower strength alcohol prices will be slashed too in a bid to make taxation “simpler, fairer and healthier”, the former Chancellor said at the time.
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In the most part it’s going to keep costs down for many Brits, which is welcome news to those unhappy about paying through the nose previously.
The Chancellor announced a range of tax rises and spending cuts today, including freezing income tax rates meaning more people will be dragged into higher bands.