Price of cigarettes could soar as Rishi Sunak ponders tax hike on tobacco

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Smokers could soon feel the pinch as Rishi Sunak reportedly ponders a rise in the price of cigarettes from a tobacco tax ahead of his Budget announcement.

The Chancellor's upcoming Budget – set to take place on March 3 – will try to pay back the eye-watering billions borrowed by the government during the coronavirus pandemic.

But it seems smokers could be unlucky for the second year in a row, after the price of a packet of cigarettes was hiked in last year's budget too.

It's unlikely Rishi Sunak will announce the rise in his Budget speech on Wednesday – but it's thought the details will be buried in Government documents if it goes ahead, The Sun reports.

The 2020 Spring Budget announced just before lockdown hit pushed up a pack of 20 by 27p – an increase of around 2%.

It took the average price of more expensive cigarettes from £12.46 to £12.73, whereas cheaper smokes went from about £8.82 to £9.10.

The same Budget saw the price of hand-rolled tobacco rise by 6%.

So-called "sin taxes" are brought in on things like cigarettes and alcohol every year, although alcohol duty was frozen in last year's budget.

The government has previously promised to keep increasing taxes on cigarettes to encourage people to kick the habit.

Rishi Sunak announced last year he'd raise tobacco duty by Retail Prices Index inflation with 2% on top of that – which could add up to a 3.4% rise this year.

HMRC reckons the tax hike on an average packet of fags will bring in around £30 million in total.

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While non-smokers will be unaffected by a rise, plenty of people who enjoy lighting up now and again are unhappy about the potential tobacco tax.

Simon Clark, director of smoker's lobby group Forest, told The Sun: "Common sense suggests this is no time for yet another increase in the cost of tobacco.

"A further rise, following two tax hikes last year, would be another kick in the teeth for consumers who buy their tobacco from legitimate retailers."

Although rumoured, it's not guaranteed the Chancellor will stick with the idea of a tobacco tax.

The 2021 Budget will be announced at about 12.30pm on Wednesday, 3 March.

Daily Star Online has contacted the Treasury for comment.

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