The Adam Smith Institute
The Adam Smith Institute is the UK's leading innovator of free-market policies. Named after the great Scottish economist and author of The Wealth of Nations, its guiding principles are free markets and a free society. It researches practical ways to inject choice and competition into public services, extend personal freedom, reduce taxes, prune back regulation, and cut government waste.

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Bringing in tobacco
By Tim Worstall

Prof. Sir Liam Donaldson, the Chief Medical Officer, has called for a change in the allowed personal imports of cigarettes from other EU countries. The full report (pdf) states:

In 2002, the indicative limits on cross-border shopping to the UK from the European Union were increased following pressure from the European Commission. An individual can now bring 3,200 cigarettes or 3 kg of hand-rolling tobacco into the UK without paying any UK tax or duty.

And makes the recommendation:

The Government should use its influence within the European Commission and with other Member States to address cross-border shopping for tobacco products,with the aim of reducing the limits to 200 cigarettes or 250g of handrolling tobacco.

The aim is, of course, to raise the price of tobacco products in the UK and thus reduce smoking.

Unfortunately Sir Liam is working with a gross misunderstanding of the law. We all have a right, an unlimited right, to make personal imports into the UK of items upon which we have paid duty and VAT in other EU countries. (There are certain limitations from the 10 new entrants, but none from the other members of the EU-15.) This is the cornerstone of the Single Market, that such cross border shopping is allowed as of right, not as a series or permissions or allowances.

The indicative limits to which he refers are exactly that, indicative. Anything below them is to be regarded as a personal import, unless there is other compelling evidence (say, three trips a day across the Channel by the same person) that the materials are for resale. It is still entirely legal to bring in larger amounts if one can convince Customs that they are for personal use. For example, one can take a pantechnicon of champagne through Dover (with an HGV license, of course) if the guest list for your daughter’s wedding proves to be compelling evidence.

A reduction in such indicative limits would make no difference whatsoever to our right to make personal imports of larger amounts. They would just lead to more time showing Customs that one is indeed a smoker.

The value of technical experts in the bureaucracy is said to be that they are able to look at the larger picture, make recommendations without being constrained by day to day political pressures. Yet when one of that august number misunderstands the law, then makes policy recommendations based on that ignorance, what hope for the rest of us?

(Tim Worstall writes here.)



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Adam Smith (1723-1790)
Adam Smith was the great Scottish philosopher and economist best known for "The Wealth of Nations", his pioneering book on free trade and market economics.

A wide selection of material about Adam Smith is now available on the Adam Smith website. This includes the full text of his two major works, The Theory of Moral Sentiments and The Wealth of Nations.