If Andy Burnham is looking to tax businesses that ‘do not make a positive contribution to society’, he should start with big tobacco

This morning, new Prime Minister Andy Burnham announced his intention to cut business rates for pubs, clubs and live music venues. He said that this will partly be funded by "reviewing reliefs for businesses that do not make a positive contribution".  

Whilst some may argue that pubs and other venues whose revenue relies on the sale of alcohol (a group 1 carcinogen) themselves fall into that category, I will leave that argument to our friends in alcohol policy. 

There is no doubt that vape shops have become deeply unpopular with the public in recent years. Many feel that the proliferation of these stores is part of the story of the decline of the high street, and there are concerns that some are fronts for organised crime or money laundering.  

However, not all vape shops are created equal. Specialist vape shops that make a conscious effort to help smokers switch away from cigarettes by using vapes are undoubtedly making a positive contribution to our local communities. Some are even working with local authorities to support cessation; including in Essex and Hertfordshire. 

That distinction matters because tobacco remains the leading cause of preventable death across the UK, killing two-thirds of long-term users- around 80,000 people every year. Shops that sell considerably less harmful alternatives, follow the law, and offer smoking cessation advice should be welcome in our communities.  

But I suspect it isn’t these shops that the public are concerned about. Rather, it’s the opportunistic retailers selling vapes alongside sweets and soft toys, where there are strong concerns about the sale of illicit products. Parliamentarians have raised concerns that many of these shops, along with barbers, are fronts for money laundering. If that is the case, then they may not be paying business rates and could well be avoiding other taxes.

If the aim is to review how we tax businesses that cause harm to local communities, then there is a much stronger candidate than vape shops: big tobacco. 

Action on Smoking and Health has long called for a levy on the tobacco industry, designed in such a way that it raises money directly from industry profits and cannot be passed on to consumers. The latest modelling shows that this could raise a whopping £5 billion over five years. 

That money could be used to invest in support to help smokers quit, while also funding other initiatives that the Burnham Government wants to introduce. 

Tobacco companies do not contribute to economic prosperity in the UK. Tobacco is not grown here and, at last count, the industry employed only around 5,000 people. By contrast, if the Government's ambition of a smoke-free country were achieved, there would be 135,000 more full-time equivalent jobs in the UK economy, worth almost £10 billion, because household spending would shift from tobacco to other goods and services that create more employment. 

The scale of the costs tobacco imposes on society is shocking. Our data shows that smoking costs society in England an estimated £44.8 billion every year. That includes: 

• Around £27.8 billion in lost productivity costs 

• £14.8 billion in social care costs 

• £1.8 billion in healthcare costs 

• £383 million in costs linked to fires caused by smoking.