Tobacco: Smuggling

Lord Flight Excerpts

Thursday 26th April 2012 Lords Chamber

[Lord Sassoon]

My Lords, we are in an open consultation period. At the end of that period, it will be for the Government to assess all the evidence. But I am grateful to the noble Lord for drawing our attention to another important piece of topical evidence.

[Lord Flight]

My Lords, many noble Lords may remember reading Parson Woodforde’s diaries in the 18th century when duty on brandy and coffee was very high and Parson Woodforde, along with everyone else, bought smuggled goods. Have the Government dispassionately looked at what might be a level of taxation that would deliver optimum tax revenues?

[Lord Sassoon]

My Lords, I remember vaguely reading Parson Woodforde’s diaries. I did not read them in the 18th century, as my noble friend suggested, but in the 20th century. It is a difficult balancing act. As noble Lords know, the policy of the Government has been to raise duty above inflation in order to deal with health issues but that has implications, of course, for smuggling and other illegal sales. Therefore, this is a more difficult balancing act where we have a health priority as well as a revenue maximisation one.