Calls to slash tax on booze, tobacco and fuel could save the poor up to £650 a year.
Experts want Chancellor George Osborne to cut “sin taxes” by 50 per cent to help millions of families fight the cost of living crisis.
The poorest 20 per cent pay £1,286 in taxes on gambling, cigarettes, alcohol and other duties, said the influential Institute of Economic Affairs.
Halving the taxes would cut a litre of petrol from £1.33 to 98p and 20 cigarettes would drop from £7.98 to £5.08.
Author Christopher Snowdon said: “The poorest spend a much higher proportion of their income on high-taxed products such as alcohol and tobacco.”
The report says a smoker from the poorest fifth of families spends up to 22 per cent of disposable cash on cigarettes.
The study, on “the sin taxes that make the poor poorer”, said: “The most effective way for the state to lift people out of poverty is to stop taking their money.”
A Government source said: “Tax is one way to change behaviour, particularly over smoking and drinking.”
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