SHOPKEEPERS warned that the 7p increase in duty on a packet of cigarettes would do nothing to tackle tobacco smuggling.

Audrey Wales, national spokeswoman for Retailers Against Smuggling, said: "This is yet another black day for independent shopkeepers up and down the country who have seen their sales dwindle over the past year as a result of the effects of tobacco smuggling.

"When will the Chancellor realise that tobacco smugglers are plaguing the streets of Britain because the high levels of taxation on tobacco in the UK creates a huge difference in price between tobacco here and elsewhere?"

However, health officials welcomed the move.

Darlington Primary Care Trust school nurse Karen Watson said: "Anything that increases the chances of people being put off smoking or, even better, lessens the chances of them starting, has to be good news for health.

"If people do choose to continue smoking, it will at least generate extra revenue, which will be needed to provide health care."

The Chancellor's announcement adding 1p duty to the price of beer was criticised by real ale drinkers.

The Campaign for Real Ale (Camra) said the increase amounted to a double blow, following price rises by several brewers and pub companies last month.

Camra chief executive Mike Benner said: "This is a disappointing Budget for beer drinkers."

The duty freeze on spirits for the eighth year running was hailed by distillers as a move promoting tax fairness and stability.

Gavin Hewitt, chief executive of the Scotch Whisky Association, said: "Today's narrowing of the duty gap aids the competitiveness of Scotch whisky producers -a flagship UK industry -by promoting tax fairness in the domestic alcoholic drinks market.

"Increasing alcohol tax fairness allows distillers to continue to invest with confidence in their brands and businesses.

"This is essential at a time when Scotch whisky producers face a range of new costs and increased regulation in a highly competitive market."

Darlington Primary Care Trust's director of planning and performance, Paul Steward, said: "Increasing duty on cigarettes and beer could have an impact on lifestyles.

"Equally important is that the budget seems to recognise the needs of elderly people, and anything that puts extra money in their pockets has to be welcomed as it will enable them to keep warm in the winter, eat well and look after themselves."