Is the excise on tobacco working? Host criticises measure
By
Seia Ibanez
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It’s surprising how expensive some things can be in Australia.
But, for American band Motley Crue drummer Tommy Lee, the surprise was more than most.
Tommy Lee was touring in Australia and decided to go to a 7-Eleven in Melbourne to buy a pack of cigarettes. Upon seeing the price of a packet of cigarettes on the receipt, he was in disbelief that a Marlboro Gold 25s cost $62.99.
‘$251.96 for 4 packs of smokes here in Melbourne!!!’ he said, sharing his disbelief on social media.
To drill his point home, he even took a shot at the convenience store’s tagline: ‘7/11 wonderfully cheesier!’
It was a huge difference from the cost of a cigarette pack in the United States, which is around $12 AUD.
The incident caught the attention of Caleb Bond, the host of Sky News Australia’s The Late Debate.
‘Despite the vast chasm in cost, the difference between the rates of smoking in Australia and the US is negligible,’ he said.
‘In 2021 it was 10.1 per cent and 11.5 per cent of adults respectively.’
‘It has nothing to do with health and everything to do with squeezing as much money out of you as possible.’
He then pointed to figures from the Australian Tax Office, which revealed that there has been a decrease of 34 per cent in the tobacco market between 2015-16 and 2020-21.
‘At the same time, the tax collected on tobacco increased 43.7 per cent,’ he said. Bond also took aim at the growth of the illegal tobacco market at the expense of above-board growth in retailers.
‘Woolworths reported in its latest annual report that its sales of tobacco dipped 16 per cent at the same time as importation of illegal cigarettes went through the roof,’ he said.
‘So despite the entire cigarette market shrinking and illegal, untaxed cigarettes growing in popularity among smokers, the government still takes home more in tax—to the tune of $14.26 billion.’
This led Bond to a conclusion: the excise tax might not be as effective as it’s thought to be.
He said, ‘If the proportion of the population that smokes in Australia and the US can be so similar despite the fact it costs so much more here, then it is clear that the extortionate excise does little to discourage smoking.’
‘It just lines the pockets of the federal government at the expense of people who are often already disadvantaged..’
Bond also compared the issue of alcohol, with $20 from each slab of beer going to the government. As a result, Australia has the fourth-highest beer tax in the world and the third-highest spirits tax.
‘Tobacco is a legal product. And despite all the window dressing, the government needs smokers for all the tax they generate,’ he said.
He added that, ‘The health-related information on smoking is readily available. That is largely what has driven the long-term reduction in smoking.’
‘But some people want to smoke and continue to smoke. That’s their business. If it brings them some pleasure in life, then butt out of their business.’
Meanwhile, the Australian Government continues to take steps to reduce smoking in the country.
According to Health and Aged Care Minister Mark Butler, the government is seriously tackling the problem, as they are looking to reduce the number of smokers by half by 2030. Last December, he mentioned their next step to achieve the goal.
‘We know that the tobacco industry has innovated by trying to make individual sticks or individual cigarettes more attractive, more marketable, in the plain packaging,’ he said.
‘I want to see a discussion about colours that make [cigarettes] unattractive, about dissuasive messages on individual sticks, which the Canadian government has just indicated they‘re going to go forward with.’
Members, have you also encountered high prices of cigarettes? Do you think tobacco excise is effective in reducing the number of smokers? Share your thoughts in the comments below!
But, for American band Motley Crue drummer Tommy Lee, the surprise was more than most.
Tommy Lee was touring in Australia and decided to go to a 7-Eleven in Melbourne to buy a pack of cigarettes. Upon seeing the price of a packet of cigarettes on the receipt, he was in disbelief that a Marlboro Gold 25s cost $62.99.
‘$251.96 for 4 packs of smokes here in Melbourne!!!’ he said, sharing his disbelief on social media.
To drill his point home, he even took a shot at the convenience store’s tagline: ‘7/11 wonderfully cheesier!’
It was a huge difference from the cost of a cigarette pack in the United States, which is around $12 AUD.
The incident caught the attention of Caleb Bond, the host of Sky News Australia’s The Late Debate.
‘Despite the vast chasm in cost, the difference between the rates of smoking in Australia and the US is negligible,’ he said.
‘In 2021 it was 10.1 per cent and 11.5 per cent of adults respectively.’
‘It has nothing to do with health and everything to do with squeezing as much money out of you as possible.’
He then pointed to figures from the Australian Tax Office, which revealed that there has been a decrease of 34 per cent in the tobacco market between 2015-16 and 2020-21.
‘At the same time, the tax collected on tobacco increased 43.7 per cent,’ he said. Bond also took aim at the growth of the illegal tobacco market at the expense of above-board growth in retailers.
‘Woolworths reported in its latest annual report that its sales of tobacco dipped 16 per cent at the same time as importation of illegal cigarettes went through the roof,’ he said.
‘So despite the entire cigarette market shrinking and illegal, untaxed cigarettes growing in popularity among smokers, the government still takes home more in tax—to the tune of $14.26 billion.’
This led Bond to a conclusion: the excise tax might not be as effective as it’s thought to be.
He said, ‘If the proportion of the population that smokes in Australia and the US can be so similar despite the fact it costs so much more here, then it is clear that the extortionate excise does little to discourage smoking.’
‘It just lines the pockets of the federal government at the expense of people who are often already disadvantaged..’
Bond also compared the issue of alcohol, with $20 from each slab of beer going to the government. As a result, Australia has the fourth-highest beer tax in the world and the third-highest spirits tax.
‘Tobacco is a legal product. And despite all the window dressing, the government needs smokers for all the tax they generate,’ he said.
He added that, ‘The health-related information on smoking is readily available. That is largely what has driven the long-term reduction in smoking.’
‘But some people want to smoke and continue to smoke. That’s their business. If it brings them some pleasure in life, then butt out of their business.’
Meanwhile, the Australian Government continues to take steps to reduce smoking in the country.
According to Health and Aged Care Minister Mark Butler, the government is seriously tackling the problem, as they are looking to reduce the number of smokers by half by 2030. Last December, he mentioned their next step to achieve the goal.
‘We know that the tobacco industry has innovated by trying to make individual sticks or individual cigarettes more attractive, more marketable, in the plain packaging,’ he said.
‘I want to see a discussion about colours that make [cigarettes] unattractive, about dissuasive messages on individual sticks, which the Canadian government has just indicated they‘re going to go forward with.’
Key Takeaways
- Tommy Lee, Motley Crue drummer, recently expressed shock at Australia's high cigarette prices, after being charged $62.99 for a packet of Marlboro Gold 25s at a Melbourne 7-Eleven.
- Despite the high cost of cigarettes in Australia compared to the US, the rates of smoking in both countries are very similar, with 10.1 per cent and 11.5 per cent of adults respectively.
- Despite the shrinking cigarette market, untaxed cigarettes are still growing in popularity among smokers, the Australian government still collects more in tax, providing a revenue of $14.26 billion.
- Caleb Bond suggests that the high cost of cigarettes in Australia is not effective in discouraging smoking, but simply lines the pockets of the federal government, with smokers often being already disadvantaged individuals.
Members, have you also encountered high prices of cigarettes? Do you think tobacco excise is effective in reducing the number of smokers? Share your thoughts in the comments below!