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2013/15: Should cigarettes be taxed more heavily?
Introduction to the media issue
Video clip at right:On August 1, 2013, Ten News ran a segment featuring treasurer Chris Bowen announcing the Rudd government’s intention to increase the excise on tobacco products. If you cannot see this clip, it will be because video is blocked by your network. To view the clip, access from home or from a public library, or from another network which allows viewing of video clips.
What they said...
'It is going to increase the cost of living for smokers [including] pensioners, low-income people'
Shadow treasurer, Joe Hockey
'It's a myth that poor smokers will be disadvantaged by a tobacco tax rise. They're the ones who are suffering most from tobacco, dying at higher rates and spending more on tobacco and related health costs'
Anne Jones, the chief executive officer of ASH Australia
The issue at a glance
On August 1, 2013, the treasurer Chris Bowen confirmed that the Rudd Labor government would increase the tax on cigarettes. Mr Bowen announced that the mini budget would contain a series of four 12.5 per cent annual increases in federal tobacco excise, pushing the price of cigarettes closer to the dollar-a-ciggie mark. The hikes are scheduled to occur on: December 1, 2013; September 1, 2014; September 1, 2015; and September 1, 2016 and to raise $5.3 billion over the four-year period.
The tobacco tax rise, a 50% increase over four years, raises the price of an average pack of cigarettes by a dollar in the first year and by up to $5.25 by the end of 2016. It will push the price of a packet of cigarettes to more than $20 in 2016.
The Coalition initially indicated it may keep Labor's pledge to increase the tobacco tax, were it to win government; however, some days after the Labor announcement and during the election campaign, the Opposition's shadow treasurer, Joe Hockey, claimed that if elected to government his party would want to consult further before deciding to proceed with the tax. The Coalition's position on this question is not yet clear.
The tax has been praised by a range of public health spokespeople and criticised by the tobacco industry.