ASH backs call to make tobacco companies pay for the damage they do

Tuesday 26 January 2016

ASH, together with more than 120 health organisations, is backing Cancer Research UK’s call to make tobacco companies ‘Cough Up’ for the harm they cause to millions of UK citizens, and to help prevent further death and disease. A proposal to impose a levy on the tobacco industry to pay for evidence-based tobacco control and stop smoking services formed a key plank of the Smoking Still Kills tobacco control strategy launched by ASH last June.[1]

Tobacco multinationals currently pay little or no corporation tax. For example, British American Tobacco plc (BAT) and Imperial Tobacco Group PLC (Imperial) are both based in the UK, and in the 2013 financial year it was recently estimated that Imperial had a 35.4% share and BAT an 8.7% share of the UK tobacco market as measured by value.[2] Imperial reports they made £623m in adjusted operating profits in the UK market [3], and whilst BAT don’t offer a profit breakdown by market, it has been estimated that BAT made at least £78.2m and perhaps as much as £150m in operating profits in the UK.[4]

Yet British American Tobacco paid no UK corporation tax in the 2013 financial year, despite being domiciled in the UK and making about £6 billion in global operating profits. Imperial only paid £6m in UK corporation tax for the 2013 financial year despite their profitability in the UK market and global adjusted operating profits of £3.2bn. The main rate of corporation tax for UK companies has of course fallen from 28 percent in 2010 to 20 percent in 2015 and is scheduled to fall further to 18 percent in 2020 as a result of changes announced in the July 2015 Budget.


Deborah Arnott, Chief Executive of health charity ASH said:

“The Cough Up campaign is supported by ASH and more than 120 health organisations, who want to see the tobacco industry pay for the death and disease caused by their lethal products. UK tobacco companies currently make massive profits while paying almost no corporation tax.”

 


ENDS

Notes and Links:

Action on Smoking and Health is a health charity working to eliminate the harm caused by tobacco use. For more information see: www.ash.org.uk/about-ash
ASH receives core funding from Cancer Research UK and the British Heart Foundation.

[1] Smoking Still Kills ASH, 2015
[2] Branston, JR and Gilmore AG “The extreme profitability of the UK tobacco market and the rationale for a new tobacco levy”, Other, University of Bath http://opus.bath.ac.uk/43061/
[3] Imperial Tobacco (2014) Annual Report and Accounts 2013, downloaded from
http://www.imperial-tobacco.co.uk/
[4] BAT (2014) Annual Report 2013, downloaded from http://www.bat.com/