 THE BACKBONE OF THE UK UNDER ATTACK The Economic Effects of Tobacco Generational Sales Ban on Retail SMEsMaged Ali No avnwz_v1, OSF Preprints from Center for Open Science Abstract: Retailers are the heart and soul of our communities. They provide us with the things we need to live our best lives and create jobs for many. They are part of our daily lives and a vital part of our local economies, especially in areas where large companies may not have as much of a presence. Many small retailers already struggle to stay open due to tight profit margins. They reinvest most of their earnings to adapt to changing customer needs and new regulations. Rising costs and over-regulation make it even harder for them to survive. A new law will make survival even harder. The UK has introduced a law banning the sale of all tobacco products to anyone born after 2009, making it the strictest ban of its kind. While intended as a public health measure, it will cut off customers and will have severe consequences on retailers. Tobacco products account for 20% of retailers' sales. Losing this income will push many stores to the brink. It will leave retailers with no viable way to adapt and transition to alternatives. The consequences are severe: declining foot traffic, reduced revenues, and widespread store closures. Over the next three decades, the UK could lose 7,700 businesses and 70,100 jobs. The government will also lose £23.8 billion in tax revenue (DHSC, 2024) and face rising enforcement costs of £828 million over the next thirty years. This equates to £819 million per year, or 72% of the UK's annual s pending on unemployment benefits (ONS, 2025a). Beyond the economic harm, the GSB will make it harder for the government to control tobacco sales. More people will turn to the illegal market, which could grow from 14.5% in 2023 to 43.2% by 2040 . This means unregulated products and easier access for minors. Profits will flow to criminal groups, enabling them to finance other illegal activities. As a result, the government will need additional resources to combat organised crime and enforce the law. The result is a lose-lose-lose scenario retailers will close, government revenues will shrink, and criminals will take control of the market. Policymakers must reconsider this approach before irreparable damage is done to the UK’s retail SMEs, leaving countless communities without their lifelines. Date: 2025-04-07 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:osf:osfxxx:avnwz_v1 Access Statistics for this paper More papers in OSF Preprints from Center for Open Science |
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