2020 Spring Budget Excise Duties
The following is a summary of 2020 Spring Budget in relation to Excise Duties.
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Tampon Tax
From the 1 January 2021, once the UK have left the EU, there will be no Tax on tampons or sanitary products.
After years of campaigning from MPs and women’s groups, this will be a very welcome announcement.
Plastic Packaging Tax
A new Plastic Packaging Tax will be introduced from April 2022 for plastic packaging which does not contain at least 30% recycled material. The proposed rate is £200 per tonne, with an exemption for small businesses purchasing less than 10 tonnes. The Government will hold a consultation on the design and implementation of this tax, and other potential exemptions.
Red Diesel
The Chancellor announced plans to restrict the use of red diesel, with a consultation to be launched later this year. Immediate changes will apply to privately owned boats. Use by agricultural and fishing industries will not be affected.
Tobacco Duty
The duty rate on all tobacco products will continue to increase by 2% above inflation, with the exception of hand-rolling tobacco which will increase to 6% above inflation.
Fuel Duty
Fuel duty remains frozen for the tenth year in a row.
Alcohol Duty
Alcohol duty remains frozen on beer, wine, cider, and spirits.
Air Passenger Duty
Short haul rates for Air Passenger Duty for the 2020/21 and 2021/22 years will remain frozen at the current levels of £26 for the standard rate and £78 for the higher rate, while the long-haul rate will increase in line with inflation.
Climate Change Levy
The Climate Change Levy on electricity will be lowered while the levy on gas will rise, to reduce the incentive of choosing gas over electricity. Other fuels such as coal will align with the gas rate.
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