The price of alcohol and cigarettes won’t be rising this year, documents following the Spring Statement show. Chancellor Rachel Reeves shared her much anticipated financial plans – or Spring Forecast – to parliament today.
In the documents published alongside the announcement, it was confirmed the price of alcohol and cigarettes will not be going up as there are no changes to the duties charged to them. Alcohol duty is a type of tax that manufacturers pay when making products. The tax varies in cost depending on the alcohol content of the drinks.
In general, spirits and wines are taxed much heavier than ciders and beer, owing to their stronger alcohol content. The duty is generally passed onto consumers by manufacturers, but product price increases are at their discretion. Follow our Spring Forecast 2025 live blog for the latest updates and to see how all the changes affect your money. What do you think of the Spring Statement? Email webnews@mirror.co.uk
In Labour’s first budget in October 2024, Rachel Reeves announced an increase in alcohol rates on non-draught drinks in line with the Retail Price Index (RPI) figure from February 1, 2025. Draught duty on alcoholic drinks below 8.5% was cut by 1.7%, which the Chancellor said at the time would see “a penny off a pint in the pub”.
Tobacco duty is a tax charged to companies making or importing cigarettes in the UK. When this is raised, the cost is filtered down onto consumers, who then have to pay more for the products in shops. There are currently 6.6million people who have the habit in the UK.
In October, Reeves announced that it would renew the tobacco duty escalator at Retail Price Index (RPI) plus 2% for the remainder of parliament. It also announced that it would increase duty by 10% on hand-rilled tobacco from 6pm on the day – October 30.
Over the last few years, the price of a pack of cigarettes has skyrocketed due to the heightened levels of inflation the UK has seen. According to the Office of National Statistics (ONS), the average price for a box of 20 cigarettes in January 2025 sat at £16.48.
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This means someone smoking a packet of 20 per day will end up spending on average £6,015.20 over the year. According to the Office of Budget Responsibility (OBR), a packet of 20 king-size filter cigarettes cost an average of £8.06 a decade ago. This represents a 91% increase over 10 years.
Smokers witnessed two tax rises in 2023, which took the average price of a packet of 20 cigarettes up to £15.67. In their final spring statement, the former Tory government announced a one-off rise to Tobacco Duty in the Spring Budget – however, this was set to be introduced in October 2026. This was to coincide with a new tax on vaping. The goal of this was to always make smoking the “most expensive” option.
Both the former Tory and the Labour governments argue that price rises will lead to less than 5% of the population being smokers by 2030, which would then classify the UK as being “smoke-free.”
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