From the BBC:
Maureen Talbot, senior cardiac nurse at the British Heart Foundation, said: "Stopping smoking is the single best thing you can do for your own health as well as those you love and live with. Quitting also makes you look better by improving your skin and teeth and, of course, it helps your finances too."
No it doesn't, by and large, not stopping smoking helps our finances...
1. Cigarettes and tobacco are in fact quite cheap, maybe 50p for a packet of twenty, the rest of the price is tobacco duty, VAT and other taxes. So if we all stopped smoking, the government deficit would increase by £20 billion, or they would put up taxes by £20 billion.
2. I smoke, and it annoys me how expensive tobacco is, but with my economist's hat on, I think that tobacco duty is quite a good tax, for why see here.
3. In the long term, everybody quitting smoking would be twice as expensive as that because ex-smokers would be claiming an extra ten years' worth of old age pension and healthcare (the amount of money the NHS spends on an average pensioner is approx. as much again as the basic state pension), but let's put that to one side.
4. When the the government puts up other taxes by £20 billion to make up the shortfall, it will put up the worst kind of taxes (VAT or NIC - because they're not really tax, are they?) and because of Laffer effects and so on, the losses would be considerable.
5. Tobacco duty is a straight transfer from smokers to non-smokers. I smoke, but my wife and children don't, so while I'm overpaying tax, they are underpaying, so asa household, we break even. This calculation is not so favourable for a household where everybody smokes, of course.
Slack Scammers
3 hours ago
12 comments:
Just a thought, has anyone quantified the Laffer effect on tobacco duty?
I'll bet there are some interesting stats on this issue.
For example, there was only one smoker in my father's care home, so are smokers less likely to be a financial burden on their kids? Are they more likely to leave a house to their kids instead of losing it wholly or in part it to care home fees?
Scottie, yes, I have. But if they do the stupid thing and go past the top of the curve, what's the worst that can happen? People quit smoking or start buying smuggled. Very few people would lose their jobs.
That's no comparison to the Laffer effects of VAT & NIC etc, which quite provably keep two or three million people out of work.
AKH, I bet you there aren't any interesting official stat's on all this, because They don't want to advertise them. It's only people like Frank Davis or me who can be bothered to guesstimate them.
It's a balancing game for the government, isn't it? Keeping the neo-puritans and fakecharities happy on the one hand and keeping a good revenue stream going on the other.
Mind you, it is still true that giving up smoking is financially beneficial for the smoker personally, so long as everyone else doesn't give it up, too. Like so many things, if just you do it, it's good, it's when everyone else does it that it's a disaster.
Personally, I never started, because I reckoned that if I did, I'd pretty soon get cancer of the wallet.
B: "Like so many things, if just you do it, it's good, it's when everyone else does it that it's a disaster."
To paraphrase: "Like Home-Owner-Ism, if just you do it, it's good, it's when everyone else does it that it's a disaster."
As a hard core LVTer, that's why I keep smoking. I see it as a kind of charitable donation to 'everybody else'.
Well in Tenessee the then Liberal Democrat governor that forced thru that states Smoking ban had an elderly smoking Mother. Yes indeed Old Folks homes got an excemption from the ban!
At one time I was a rarity, in that I rolled my own. In the last few years it has become much more prevalent in my area, particularly amongst the (to my eyes) younger, including the women. Perhaps an indication that the peak of the Laffer curve has been passed? Even ignoring the Man with a Van effect (TM LI), and he supplies a lot of it, if that's common elsewhere the tax take is already taking a hit.
(the cost of 3 packs of fags keeps me in baccy for a fortnight+)
HR78, thank Heavens for small mercies, if we ever get that old.
VFTS, agreed, we're somewhere near the top of the tobacco duty Laffer curve. I have notice esp. more women rolling their own as well.
Thanks for carrying the #Octabber badge Mark - it's the month of October dedicated to those who like smoking tabs and don't want to quit - or those who don't smoke but value the tax smokers pay which would mean much higher taxes for everyone else if we suddenly quit en masse.
What would be nice is if the Govt set a realistic tax on the product and didn't just screw us for more because they know they can.
P, it is getting nasty, my local supermarket put up 25g Old Holborn from £7.86 to £8.10 yesterday.
Did you also factor in you'll be snacking a lot more when you quit? A sandwich and a bag of crisps from Pret, not cheap.
BS, yup, the decline in smoking is equal and opposite to the modest rise in not-being-quite-so-thin-any-more and indeed childhood asthma.
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