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HMRC internal manual

Tobacco Products Duty

National Advice Service Enquiries - Importing cigarettes: price for duty purposes

Entrepreneurs frequently enquire about importing cigarettes into the UK and wish to know how the duty will be calculated. There are two components to the excise duty on cigarettes:
 

  • a specific element, being a rate per 1000 cigarettes; plus
  • an ad valorem element, being a percentage of the retail price.

The retail price (on which the ad valorem element is calculated) is usually the recommended Retail Selling Price (RSP) in the importer’s price list. (The use of any other retail price, for duty purposes, must be agreed by the Tobacco Team)

If the brand is new to the UK market (ie is not currently on sale within the UK), the importer is free to recommend a RSP. In such a case he must provide a copy of his current price list or other evidence of the price, which he recommends. Sometimes a potential importer may find an alternative source for a brand that is already sold within the UK. In that case the retail price, on which the ad valorem element of the duty will be calculated, will be that already set by the established importer.