http://www.telegraph.co.uk/news/2017/03/03/tax-us-worlds-biggest-cigarette-maker-tells-philip-hammond/
The world’s biggest tobacco company has for the first time asked to be taxed more by Chancellor Philip Hammond – to encourage smokers to switch to healthier alternatives.
Philip Morris, which makes brands such as Marlboro, said it backed an increase in taxes on its cigarettes as part of its bid to move to a “smoke-free future”.
In a Budget submission sent this week to Philip Hammond, the Chancellor, Philip Morris said “we support proportionate tax increases”.
Cancer is caused by burning the tobacco in cigarettes. Currently a packet of 20 Marlboro cigarettes costs £9.60, of which £7.10 is excise duty and VAT.
But a packet of 20 Iqos cigarettes – which heat, rather than burn the tobacco – cost £7 of which £2.94 is from excise duty and VAT. A packet of 20 Nicolite e-cigarettes cost £4.75 of which 79p is VAT.
The four page submission – a copy of which has been seen by the Telegraph – said: “Our priority is clear – to switch, as quickly as possible, hundreds of millions of adult smokers across the world to less harmful alternatives than continued smoking.
“While there is no substitute for quitting, we believe that harm reduction (ie promoting safer alternatives to those who would otherwise still smoke cigarettes) can bring significant public health benefits.”
Harm reduction was “an essential element of public health policy, and fully endorse regulatory and fiscal policies” which encourage consumers to switch from cigarettes.
Peter Nixon, UK managing director of Philip Morris, said: “We want to move towards a smoke-free future and a lot of that is incentivising people to move across from cigarettes to something that is less harmful.”
Mr Hammond is expected to confirm in Wednesday’s Budget that cigarettes will continue to be taxed at inflation plus 2 per cent.
Mr Nixon said he would not (want) taxes to be higher because that would act as an incentive for smokers to switch to illicit cigarettes that are smuggled into the UK.