HC Deb 19 April 1920 vol 128 cc88-9

Sparkling wines are not the only objects of luxury on which I think in present circumstances we may make a call, and which can afford to bear additional taxation. There is another commodity—imported cigars. Hon. Members are aware that imported cigars have been the subject of a special surtax for many years, which has been increased from time to time with the increase of the tobacco duty. Even to-day it amounts only to 2s. 2½d. per lb., representing only a trifling proportion of the price at which expensive cigars are sold to the public. But imported cigars are of many qualities. Some are luxuries; some are not. It is clear that it would be unfair to tax at the same rate the cheapest Indian cheroot and the most expensive Havana cigar. I propose, therefore, in the case of cigars, as in the case of sparkling wines, that the additional duty should be levied in the form of an ad valorem duty at the rate of 50 per cent. The existing surtax of 2s. 2½d. would remain. Taking an average on the figures for 1919, the 50 per cent. duty would represent a duty of 15s. per lb. on Cuban cigars, and allowing for preference, a duty of 1s. 4d. per lb. on Indian cigars. It is estimated that this would yield £500,000 in the current year, and £530,000 in a full year. I propose that, as in the case of sparkling wines, preferential rebate on imported cigars should be at the rate of one-third, which is the rate now in force with regard to the ad valorem duties imposed in 1915. After allowing for the repeal on January 1st of the petrol duty, and of existing motor licences, I thus obtain from Customs and Excise an increase of £48,650,000 in the current year, and of £54,730,000 in a full year. I do not propose to ask any more from that source.