Tobacco: Excise Duties
The question
To ask the Chancellor of the Exchequer, what assessment she has made of the potential impact of planned double duty increases on tobacco products on inflation.
Answered by Dan Tomlinson
Forecasting the economy, including the effect of Government policy decisions on inflation, is the responsibility of the independent Office for Budget Responsibility (OBR). The OBR set out the impact of policy measures on inflation in its Autumn Budget 2025 forecast, including the rise in tobacco duty. The OBR have not adjusted their inflation forecast for the rise in tobacco duty.
The Chancellor asked departments to prioritise reducing inflation when developing policies for the Autumn Budget, ensuring decisions support stability and long-term growth. Considering all policies, the OBR expect budget measures to reduce CPI inflation by 0.4pp in 2026/27.
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