Reducing the exceptional affordability of hand-rolling tobacco using tax escalators: a health and economic impact modelling study for England

Background

Hand-rolling tobacco (HRT) remains more affordable than factory-made (FM) cigarettes in the UK, which could undermine the health benefits of tobacco tax increases. This study modelled health and economic impacts of raising HRT duty annually to reduce this affordability gap.

Methods

We used the Sheffield Tobacco and Alcohol Policy Model V.2.5.0, an individual-level microsimulation, to project tobacco consumption, spending and health outcomes for adults in England aged 18–89 from 2024 to 2030. Four duty policies were compared against a business-as-usual scenario of duty rising 2% above the Retail Price Index (RPI) annually: Policy A increased duty by RPI+12% in 2024 only (the UK Government’s October 2023 policy); Policy B applied RPI+10% annually to align with FM duty by 2030; Policy C applied RPI+12% annually; and Policy D applied RPI+18% annually to equalise average HRT and FM prices by 2030.

Results Policy

A was estimated to prevent 1770 deaths, add 36 947 life years and save the National Health Service £12 million, with greater gains in deprived areas. Policies B–D achieved larger health benefits and reduced inequalities, but increased spending by people who smoke. Policy D generated £3.19 billion additional tax revenue and reduced tobacco industry revenue by £400 million by 2030. Revenue effects depended on assumptions about how higher HRT prices affected FM consumption.

Conclusions

Sustained duty increases on the least expensive tobacco products could deliver substantial public health gains and reduce health inequalities. Such measures should coincide with strong enforcement against illicit tobacco and comprehensive smoking cessation support.