More of us smoke than want to admit it (Image: Getty)
Tax officials are planning an investigation into the nation’s secret smokers, amid fears that black market tobacco is costing the Treasury billions in lost revenue.
HM Revenue and Customs (HMRC) estimates around 14% of tobacco duty goes unpaid, the equivalent of £1.3 billion.
But officials have now admitted the real figure could be higher, because the number of smokers is greater than government figures show.
Officially, around 5.3 million people aged 18 years and over, 10.6% of the adult population, are believed to be smokers.
But this is based on the Annual Population Survey, a survey of the British public carried out by the Office for National Statistics.
And HMRC many smokers lie about their habit when they are completing the survey. If the true number of smokers is higher, it would mean even more tax is going unpaid than thought.
The tax agency is now recruiting scientists to analyse the nation’s pee – to try to work out how many of us really smoke.
Jonathan Athow, HMRC Director General for Strategy and Policy, said the investigation would help HMRC calculate the “tax gap” – the difference between the amount of tobacco duty received and the amount that should be paid.
A smoker in Oxford Street, London (Image: Getty)
He told a Commons inquiry: “One of the things we are now investing in is research, with a private sector company, looking at whether we can use waste water – sewage – to detect metabolites of nicotine, so we could estimate how much people are actually smoking.
“Once you know how much people are smoking and how much is legitimate, because we know how many clearances there have been and how much cross-border shopping, we can work out what the gap is.”
However the Treasury is due for a windfall when a new tax on vaping products comes into force on October 1. Excise duty of £2.20 per 10ml on vaping products, whether they contain nicotine or not, will come into force alongside tobacco duty increases. Together, they form part of the government’s wider plans to end smoking entirely.
It will become an offence to sell tobacco to people born on or after 1 January 2009, ensuring nobody aged 18 or under on January 1 2027 will ever be able to smoke.
The Home Office has launched a crackdown on “dodgy” high street shops, including those selling tobacco illegally as well as premises used as a front for money-laundering, with police and council trading standards departments given stronger powers to close rogue businesses for longer.
Claire Jolly, Senior Director, Corporate Affairs PMI said: “Last year taxpayers lost close to £4.3 billion to the illegal tobacco trade, that could have helped fund our police, border security or Trading Standards. The Government needs to urgently shut down the industrial-scale criminality blighting our high streets.”