Can the Government legislate our ‘bad’ behaviours away? The naive and possibly conceited have always believed the answer is yes. If the Government bans enough things and taxes the rest, we will simply do as the nanny state says. They think themselves particularly noble when the banning is done in coordination with Brussels. From petrol cars to gas boilers, this double-edged attack on our freedoms continues to be enacted.
Nowhere is the fantasy more glaring than in the UK’s generational smoking ban and the EU’s Tobacco Excise Directive. The generational tobacco ban, enacted through the Tobacco and Vapes Bill, will mean that anyone born after 1st January 2009 will never be able to buy tobacco products legally.
This will create the absurd situation in which a decade from now, a 28-year-old will be able to buy a packet of cigarettes, but a 27-year-old will not. This policy will create two classes of adults, some of whom have the right to purchase a product and some do not. Not only is this policy illiberal, but it is likely to be ineffective. This is because it is playing directly into the hands of criminals.
We know this is true because it is already happening. The latest tobacco sales figures show that between 2022 and 2024, legal cigarette and rolling tobacco sales fell by 41%. The number of smokers between 2022 and 2024 had barely changed, and so it is abundantly clear that the black market is already out of control. It makes sense, why would a smoker pay extortionate tobacco taxes when they can easily buy the same product on the black market for a fraction of the price?
We may well suffer the same ill consequences that the US did during the prohibition of alcohol. It is difficult to imagine that level of violence bubbling up over tobacco, but we only have to look at Australia to see what monster could be unleashed. Australia has aggressive tobacco restrictions and sky-high taxes, as well as a complete ban on vapes outside of pharmacies.
In Victoria, there have been more than 100 firebombings of tobacco shops in the past year alone, as criminal gangs wage open warfare for the sale of their illegal products. Legitimate businesses are being threatened, torched, and driven out.
This is where Britain and Europe are headed.
Meanwhile, Brussels is pushing ahead with its Tobacco Excise Directive, seeking to ‘harmonise’ and increase tobacco taxes across the EU. The entirety of Europe is becoming more and more nanny statist, with individual countries taxing, regulating and banning tobacco products more and more year after year, and Brussels cheering them on.
Despite leaving the European Union, we have failed to diverge from Europe when it comes to tobacco control. In fact, the UK continues to be significantly worse. According to this year’s edition of the Nanny State Index, a ranking of 29 European countries on their lifestyle freedoms, the UK is already the #1 worst country in Europe to smoke. With plain packaging, a ban on indoor smoking, and some of the highest tobacco taxes in Europe, it is no wonder that the black market is flourishing. The generational ban will quite literally place us off the charts.
Often well-intentioned policymakers wish to control our lifestyles in the name of public health. The problem is that it does the exact opposite.
Who exactly benefits from tobacco control? Criminals! These are the same gangs that traffic people, smuggle drugs, and exploit the most vulnerable in our society. Taxes and bans line
the pockets of criminals at the expense of everyone else. Politicians are ignoring the growing black market because it doesn’t fit into their notion of good policy making. They believe that because they say something is illegal, it simply disappears. Anyone who has walked on the streets of a city in the UK knows that, despite cannabis being illegal, it is widely accessible (you can regularly smell it on the streets).
Despite politicians’ self-belief in their omnipotence, the law does not dictate reality. Because policymakers are in denial that a black market exists, there is no way of telling exactly how much criminals will profit from the generational ban. Judging by international examples, it is probably going to be a lot.
In Australia, following hikes in tobacco duty and a 67% increase in the price of cigarettes, the black market for tobacco has grown to be worth an estimated $5bn a year. The Government now raises less tax revenue from tobacco sales.
In 2019, it raised $16.8bn, but after the rate increases, the black market exploded and there was a collapse in the legal sale of legal cigarettes. The levy now raises $10bn and is on
track to fall to $6.4bn by 2028. The taxpayer is $10bn worse off, smokers are worse off, and Australians deal with regular firebombing attacks on their off-licenses. The only winners are
the gangs.
To translate this across to Europe, let us first consider the dire state of border security.
The Australian Border Force confiscates more than $2bn of illegal and unregulated tobacco products a year. Europe, by contrast, has notoriously bad border security (how many illegal migrants?). Further to this, Europeans smoke nearly twice as much as Australians. Even if we assume Europe can do as good a job keeping out smuggled goods as the Aussies, at that higher smoking rate (and with 450 million people compared to Australia’s 27 million), were a black market to emerge in the EU of proportional size, it could feasibly grow to be worth more than 30 times as much, at around €95bn. More money for smugglers.
Either tobacco is provided by a taxed and regulated private sector, or it is provided by criminal gangs. There is no third option. Which way, Western man?
Reem Ibrahim is Communications Manager and Linda Whetstone Scholar at the Institute of Economic Affairs