Report proposes halving UK tobacco tax

A report published yesterday by the U.K.’s Institute of Economic Affairs proposes cutting taxes on fuel, alcohol and tobacco by half, scrapping green energy subsidies and reducing VAT from 20 percent to 15 percent.

The report, Aggressively regressive: The ‘sin taxes’ that make the poor poorer, says that reducing taxes in this way would put money back in the pockets of those who are in greatest need of it.

“All told, the poorest households pay 37 percent of their gross income in direct and indirect taxes,” a report press note said.

“To put it another way, the single biggest expenditure for people in poverty is tax. This leads us to the conclusion that the most effective way for the state to lift people out of poverty is to stop taking their money.”

Christopher Snowden, the author of the report, is due to take part in Tobacco Reporter’s Global Tobacco Networking Forum at Cape Town, South Africa, next month.

The report can be accessed at http://www.iea.org.uk/in-the-media/press-release/poorest-hit-hardest-by-consumption-taxes-new-research-shows.