Tax Treatment of Heated Tobacco Products

    Following the Spring Statement the Treasury published the response to the consultation on the tax treatment of heated tobacco products.

    These products are a recent innovation in the tobacco market.  Processed tobacco is heated, but not burned as it is in conventional tobacco products, to produce or flavour vapour which is then inhaled by the consumer.

    The purpose of the consultation was to consider whether these products should be subject to a new classification attracting a different level of duty to the existing five classifications of products.

    The outcome of the consultation was that the majority of the respondents were in favour of a new category for these products, based on the weight of tobacco in a capsule contained in a product.  The government will now publish draft legislation in the summer for technical consultation prior to legislation to be included in the Finance Bill 2018-19 to take effect on Royal Assent.