Hullabaloo over the tobacco tax hike and planned plain cigarette packaging law

By Dr. Ananya Mandal, MDApr 29 2010

The Australian Federal Government this week announced an increase in taxes by 25% on cigarettes to discourage smoking and generate funds for more antismoking measures. In a new development Federal Opposition Leader Tony Abbott announced that the Coalition will support this move.

The Government also plans to implement laws stating that cigarettes can be sold only in plain packs with graphic health warnings. This is planned to take effect from July 2012. Federal Health Minister Nicola Roxon had earlier expressed her hopes that the Opposition will support them in this move.

Mr. Abbott in his statement said that although he believes this tax hike to be an ‘eye-ball grabbing’ move, he will support it. “I'm not going to defend smoking and I'm not going to oppose the measure because it might have some useful health spin-off,” he said. However he also added that total refusal of funds from cigarette manufacturers is not acceptable. He feels it is “legal” to smoke and cigarette manufacturers are not “mafia”. “I don't see why, if they want to make a donation, we shouldn't accept it. But look, I'm not out there touting for business,” he said.

The price hike of $2.16 to a pack of 30 cigarettes that took effect from last midnight had ignited a cigarette buying and stocking spree last night. The Government expects this new tax to reduce tobacco consumption by 6 percent and reduce the number of smokers by 87,000. The revenue generated would also aid healthcare and hospitals. Most public health experts and anti-smoking organizations have welcomed this move. Some however fear that people may divert money from necessary expenses of family to keep their addiction going.

The cigarette manufacturers are unhappy about the plain packaging move and plan legal action. Prime Minister Kevin Rudd assured that the legislation would be ready for such action. “Our position is strong. Tobacco companies can do what they like. This government will not be deterred,” he said in a statement. Imperial Tobacco Group Plc, of Bristol, U.K and London-based British American Tobacco Plc, or BAT have voiced their feelings saying that this move of plain packaging would affect the “value of our business” and “takes away the ability of a consumer to identify our brand.”