Vape tax and another National Insurance cut could come in next week's Budget

27 February 2024, 08:09 | Updated: 27 February 2024, 09:44

By Natasha Clark

@NatashaC

Extra taxes on vapes and another cut to National Insurance could come in next week's Budget.

LBC understands that the Chancellor is considering bringing forward mooted plans to slap extra taxes on vapes to raise extra cash at next month's fiscal statement.

It was first floated as part of documents in the King's Speech - where the PM said he wanted to ban them for children.

Disposable ones will also be outlawed in future.

The duty is expected to come forward as part of plans to outlaw the sale of cigarettes to under 18s - something the PM wants to be his legacy.

Reports say that the higher the nicotine level, the more the tax.

Around 40 other countries have already introduced similar taxes, but the PM wants to strike a "balance" to try not to discourage people from using them to quit smoking.

It's likely that duty on tobacco could rise too - to make vaping still cheaper than smoking.

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The March 6 statement could be the final budget before the next election, which is expected later this year.

But the Treasury has less money than expected to play with, according to the latest set of finances seen by the Treasury.

It's thought the Chancellor could have only £12billion in headroom, so changes may be less than the PM had suggested earlier this year.

Plans for an inheritance tax cut are also understood to have been binned thanks to a lack of cash in the coffers.

But another National Insurance cut and continuing the fuel duty freeze could be on the table as a pre-election sweetener.

Income tax cuts are less likely as they'd cost more to do.

The Chancellor will reveal the full statement to MPs next Wednesday.

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