Scottish Government welcomes JTI intervention on tobacco duty

Has to be true because I read it in the Scotsman! Japan Tobacco has pointed out that post-Independence the Scottish Government will receive tobacco revenues directly, and speculates that it might think twice about bringing in policies that might jeopardise revenue receipts.

I have to put this in context a little. The suggestion is that the Scottish Government will get revenue-raising powers even if Scotland doesn't go independent. I am still not sure why Westminster would want to encourage devolution of tax-raising powers if the vote is no, because it would allow more divergent economic policies to develop than we have at present – surely the kind of scenario that Westminster rejects when saying that sharing a currency with an independent Scotland wouldn't work.

The Scottish Government clearly want a situation with more tax powers, and in fact I agree with them – it is right that Holyrood should have the responsibility for raising revenues as well as spending them. (I also agree with them that they are unlikely to be able to exercise responsibility fully in a devolved Scotland, but that's not really the point of this article.)

The purpose of the JTI intervention is to sound a warning shot about the Scottish Government's plans for plain packaging of tobacco. I am not aware of any certain evidence about plain packaging deterring youth from smoking. There has been a lot of speculation, but no hard evidence.

I can speculate too, and my speculation is that criminalising the branding of tobacco removes a tool for consumer protection that is designed to reduce counterfeiting, and is likely to result in a race to the bottom in tobacco prices. If such a move is backed by further increases in duty, the illegal market will grow even faster than it is growing currently.

Both these moves will be bad for government smoking cessation plans – for its heralded ambition to make smoking history by 2034 – and for its treasury coffers. Treating e-cigarettes in the same prohibitive way as tobacco, rather than as a probably harmless alternative, will aggravate this effect.

The Scottish Government's comment?

The intervention on devolving duties has been welcomed by the Scottish Government.

A spokesman for First Minister Alex Salmond said: “We welcome all backing for transferring responsibility for duties and revenue to Scotland.

“Only by having control of these key levies can we take forward policies designed to protect public health and boost the Scottish economy.”

They'll have to mull that one over before it's time to produce the first post-Referendum election manifesto.

Sunday Post reports dangers of counterfeit tobacco

To its credit the Sunday Post has published a story on the dangers of illicit cigarettes (the story is not published online). It reports the views of Roy Ramm, former Commander of Specialist Operations at New Scotland Yard, who 'has witnessed the illicit tobacco trade explode from a small-time cottage industry to a multi-billion pound trade of global proportions in his 30 year career'.

The content of these illegal products is, by definition, unregulated. Ramm speculates that 'fake fags can be 50 times more dangerous than normal cigarettes', as they may contain 'arsenic, asbestos or rat poison'. Unlike anti-smoking campaigners he is prepared to acknowledge a difference between a hazardous product that it regulated and a hazardous product that is not.    To the anti-smoking zealot, there is no difference between regulating a product and condoning it. Ramm is able to make this distinction, but the anti-smoker cannot say that fake fags are particularly dangerous without worrying about the implication that 'normal' ones are less dangerous.

 As per usual, Cancer Research UK is quoted in the article denying that plain packaging will have any impact on smuggling. To the extent that the plain packaging policy is not in place anywhere it may be hard to produce tangible evidence for an increase in tobacco smuggling.

But the logic of tobacco control is to denormalise smoking. I reported recently the story of a tobacconist forced by law to stop calling his shop 'tobacconist'. How are shops meant to convey what they have to offer the customer in the face of such laws? And if shoppers cannot find the legal product in their high street or local shop, where are they supposed to go? Anti-smoking campaigners cannot seem to see the hazard to the smoker in such a policy direction – or if they can see it they blame the smoker for wanting the product or the evil bastard who is prepared to supply it.

Nowhere do they blame themselves for failing to accommodate tastes that are more risky than their own. In their blindness they undo all the good work of regulators who have worked out what legal additives may be used in tobacco: first by insisting on extremely high tax levels, and then by hampering the operations of legal outlets, in the misguided hope that it will stop customers wanting the product at all.

Just as banning boxing would not stop people fighting (only ensure they did it without any recognised constraints, rules or etiquette), so this all-but-prohibitionist approach to tobacco will not stop people taking narcotics – especially in this age of economic austerity, where money is tight for so many. If a known risk is made inaccessible, life becomes more precarious and the quantity of unknown risks increases.

Cancer Research should note: it is not enough to say that plain packaging will not encourage smoking. They should absolutely lay off their policy of denormalising smokers and everybody involved in supplying legal and regulated tobacco. Smuggling of tobacco is already on an upward trajectory and plain packaging will do nothing to stop it.

A skeleton of this story appears online today in the Scotsman: perhaps the discussion will shed more light on it!

BAT produces cheaper brand to compete with illegal tobacco in Australia

The story is here. British American Tobacco claims to have lost market share to unregulated tobacco since a 25 per cent tax rise two years ago. It has produced a budget pack of cigarettes in order to win back some of its customers. The pack sells at a small margin over the price of illegal tobacco.

The Health Minister claims not to be convinced that this is a matter of commercial survival, and accuses BAT of targeting children. As Health Minister she is sheltered from the commercial realities of competing in a market like tobacco, and 'targeting children' is an accusation that it is all too easy to make. I tend to feel that she lacks the qualification to comment. Her faith is that taxes help smokers to give up smoking, and by producing a cheaper brand BAT is simply failing to cooperate with her comforting fantasy.