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HMRC internal manual

Holding and Movements Export Shops

Guide to calculating excise duty: Tobacco

Including: Cigarettes, Cigars, Hand-rolling tobacco, Other smoking tobacco and Chewing tobacco.

Cigarettes are charged at a percentage rate of their retail value plus a fixed rate per 1000 cigarettes. The duty rate in 2002 is 22% of the retail price plus £94.25 per thousand cigarettes.

To calculate the excise duty on one case of cigarettes containing 5000 cigarettes; retail value £4.45 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 £4.45 = £1112.50.

Part of the duty calculation is: 22% of the retail value = £1112.50 x (22/100) =£244.75.

The other part is £94.24 per 1000: 5000 x £94.24 = £471.20. 1000

The total duty for the case is £471.20 + £244.75 = £715.95.

Other tobacco products are calculated as an amount in sterling per kg of weight. The present rate (2002) for hand-rolling tobacco is: £98.66 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 £98.66 = £493.30.