HMEXSH5040 - Guide to calculating excise duty: Tobacco
Please note: The below are only examples of how to calculate excise duty. The duty rates on these calculations are only correct from the date specified and may have changed. Please check GOV.uk for current duty rates and information on the MET.
Including: Cigarettes, Cigars, Hand-rolling tobacco, Other smoking tobacco, Chewing tobacco and Tobacco for heating.
Cigarettes are charged at a percentage rate of their retail value plus a fixed rate per 1000 cigarettes. The current duty rate (Sept 2019) is 16.5% of the retail price plus £228.29 per thousand cigarettes.
To calculate the excise duty on one case of cigarettes containing 5000 cigarettes; retail value £11.00 for a pack of 20.
Find the number of packs per case:
5000/20 = 250 packets in the case.
The retail value of the case is: 250 x £11.00 = £2750.00
Part of the duty calculation is: 16.5% of the retail value = £2750.00 x (16.5/100) = £453.75.
The other part is £228.29 per 1000: (5000 x £228.29) / 1000 = £1,141.45
The total duty for the case is £1,141.45 + £453.75 = £1,595.20
Other tobacco products are calculated as an amount in sterling per kg of weight. The present rate (Sept 2019) for hand-rolling tobacco is: £234.65 per Kg.
To calculate the excise duty on a case of Hand-rolling tobacco weighing 5kg.
Multiply the Kg amount by the excise duty rate. 5 x £234.65 = £1,173.25.
Tobacco for heating is calculated on the weight of the tobacco or tobacco mixture and applied per thousand sticks. The present duty rate (2019) is £234.65.
So, for instance, Excise duty due on 1000 sticks is calculated as follows:
1000 sticks = 0.305 Kg (or 305 grams) being an average weight for the sticks
Times the weight in kilograms by the excise duty rate e.g.
0.305(weight) x £234.65 (excise duty rate) = £71.57 per 1000 sticks
In an example of 200 heatsticks the calculation would be as follows:
If 1,000 Heatsticks weigh 0.305kgs, 200 will weigh 0.061kgs
0.061kgs x £234.65 = £14.31