The Coalition is considering slashing the tax on tobacco products by at least 80 per cent – as experts warn that more Aussie smokers will be “encouraged” to source cigarettes from the booming black market when the excise rises again next month.
One Nation leader Pauline Hanson on Tuesday promised to cut the excise by 75 per cent in a bid to crackdown on the tobacco wars, saying Australians were “sick and tired of the firebombings, shootings and murders”.
In a statement, she said indexation would be frozen for three years, there would be stronger border enforcement, faster tobacco shop closures, tougher penalties for traffickers and attack organisers – but did not provide details.
Nationals leader Matt Canavan accused Ms Hanson of flip flopping on the policy, after she previously called for a 50 per cent reduction, and said the Opposition’s comprehensive plan to crush illicit trade would be “costed and considered”.
“We have said for some time that the excise rate needs to be cut to kill organised crime and kill the black market,” Mr Canavan told News24. “The government’s got its head in the sand, but obviously neither ourselves or One Nation can make this change tomorrow.”
Shadow cabinet is considering a major excise reduction of “at least” 80 per cent to make legal products competitive with those on the illicit market following a recommendation from Coalition’s illicit tobacco task-force co-chairs Richard Colbeck and Mary Aldred.
The cut would be part of a suite of measures aimed at tackling illicit trade, addressing nicotine addiction and reducing consumption.
The Coalition’s multifaceted plan will also be informed by a parliamentary probe into Australia’s illegal tobacco crisis – which Coalition MPs were quick to point out that One Nation never attended – that is due to hand down its report at the end of August.
One option to slash the excise to zero for a period is off the table.
Illegal nicotine products make up 80 per cent of the market and from September 1, the excise on a cigarette stick will rise to $1.55 after indexation.
Former AFP and Border Force investigator Rohan Pike said: “Every excise rate increase for the last 15 years has … encouraged people to move across to the illegal market.”
“The very few people that are left in the legal market, this will incentivise them to break the law,” Mr Pike said.
Criminologist Dr James Martin said a 75 per cent reduction, which would reduce a $38 packet to around $14, would make smokers reconsider buying black market products.
But Treasurer Jim Chalmers rejected calls to cut the excise saying the government remained focused on compliance.
“Some recent successes when it comes to cracking down on illicit tobacco, but we still have a lot of work to do, it is still a very substantial challenge, and we’re addressing it the best we can,” Mr Chalmers said.
Health advocates have also rejected calls to cut the excise.
Extracted in full from: https://www.heraldsun.com.au/news/victoria/coalition-considers-slashing-tobacco-tax-by-80-per-cent-to-fight-black-market/news-story/db24ed2e775772aed784763ed1b60355
