{
  "$type": "site.standard.document",
  "bskyPostRef": {
    "cid": "bafyreiefltmprlqcs4pdo57fvadladbgyezrfl2bvutbhju57fdnkplsae",
    "uri": "at://did:plc:oznbnvgr7dmvddiyvr7dih52/app.bsky.feed.post/3mhv35tlx7sc2"
  },
  "coverImage": {
    "$type": "blob",
    "ref": {
      "$link": "bafkreibmrslgyl5gbusaw5ml4mcxnxzymk7o4vgllogaepzbyharp7s6ym"
    },
    "mimeType": "image/jpeg",
    "size": 61570
  },
  "path": "/money/rachel-reeves-tobacco-tax-raid",
  "publishedAt": "2026-03-25T11:44:51.000Z",
  "site": "https://www.gbnews.com",
  "tags": [
    "Inheritance tax warning as pension rule change could leave families facing unexpected bills",
    "Major HMRC changes to ISAs affect millions of savers as tax deadline looms: 'Use it or lose it!'",
    "Labour urged to 'end threat of prison' for council tax non-payments as hikes hit millions from April",
    "The GB News Editorial Charter"
  ],
  "textContent": "\n\n\nChancellor Rachel Reeves faces a £167million shortfall in tobacco tax revenues as British smokers increasingly turn to illicit cigarettes.\n\nHM Revenue and Customs (HMRC) figures reveal that tobacco receipts between April 2025 and February 2026 plummeted by £500million, representing a six per cent decline compared with the previous year.\n\n###\n\n\n\n\nHowever, the drop in actual smoking rates tells a different story entirely.\n\nDuring the same period, the number of Britons lighting up fell by just four per cent.\n\n###\n\n\n\n\nTRENDING\n\nStories\n\nVideos\n\nYour Say\n\n###\n\n\n\n\nThis two percentage point gap suggests that rather than quitting, smokers are simply abandoning duty-paid products in favour of black market alternatives.\n\nThe discrepancy points to a growing crisis for the Treasury as elevated duties appear to be pushing consumers towards criminal suppliers rather than deterring tobacco use altogether.\n\nShadow Business Secretary Andrew Griffith issued a warning to the Chancellor, urging her to reconsider further duty increases that risk driving more British consumers into the hands of criminal networks.\n\nHe told GB News: \"Labour's tobacco tax grab is not working. The impact of illiberal policies to force people to stub out their cigarettes forever is costing Britain cash it doesn't have.\n\n###\n\n\n\n\n###\n\n\n\n\n###\n\n\n\n\n\"This Government talks about protecting the high street, but their sky-high taxes are driving customers away from local shops and towards black market packets and duty free bargains.\"\n\nThe frontbencher's comments follow warnings delivered to Ms Reeves prior to her November Budget that her tobacco duty proposals would fuel the illicit trade.\n\nThe situation looks set to worsen considerably come October, when a double blow awaits tobacco purchasers.\n\nFrom the first of that month, duties will rise by two per cent above the rate of inflation, whilst an additional one-off levy of £2.20 will be applied to every 100 cigarettes sold.\n\n### LATEST DEVELOPMENTS\n\n\n\n\n  * Inheritance tax warning as pension rule change could leave families facing unexpected bills\n  * Major HMRC changes to ISAs affect millions of savers as tax deadline looms: 'Use it or lose it!'\n  * Labour urged to 'end threat of prison' for council tax non-payments as hikes hit millions from April\n\n\n\n###\n\n\n\n\n###\n\n\n\n\nThe scale of the existing black market problem is already concerning industry experts.\n\nResearch conducted by IPSOS last year estimated that half of all cigarettes consumed across Britain are now illicit.\n\nMeanwhile, a KPMG report published in 2025 calculated that illegal tobacco cost the Treasury some £3.15billion in lost revenue during 2024 alone.\n\nExperts caution that the forthcoming October increases will only accelerate the exodus of smokers towards untaxed products.\n\nThe forthcoming tax increases will push Britain closer to the Australian model, where tobacco duties rank among the highest globally.\n\n###\n\n\n\n\n###\n\n\n\n\nAcross the Tasman, the consequences have proved severe, with illegal tobacco retailers proliferating and organised crime gangs waging turf wars on suburban high streets.\n\nAustralian authorities have been forced to respond by equipping investigators with enhanced powers including wire taps and strengthened asset seizure capabilities.\n\nRohan Pike, a former Australian Border Force officer, said: \"Australia should serve as a cautionary tale for Rachel Reeves.\n\n\"We raised tobacco taxes repeatedly, handed the black market to organised criminal gangs on a plate, and now face a massive enforcement bill in a futile attempt to claw it back.\n\n\"The UK Chancellor is making the same mistake in slow motion. Every time she hikes tobacco duty, she isn't hurting the criminals - she's funding them. If she wants to avoid Australia's fate, she must prevent the problem, not fuel it.\"\n\n###\n\n\n\n\n\n\n\n\n\n\n**Our Standards: The GB News Editorial Charter**",
  "title": "Rachel Reeves's tobacco tax raid creates £167m shortfall and 'pushes Britons to black market and duty free'"
}