Cigs hit $30 price point on excise jump, AACS questions illicit tobacco research

Cigarette prices are edging towards a dollar a stick

A pack of 40 cigarettes will cost smokers over $30 and a pack of 20 cigarettes above $20 under tobacco excise raises of 12.5% and the normal twice-yearly indexation now taking effect.

The additional taxes will add between $1.12 to $2.81 to the price of cigarettes, which may see a continued shift to low-priced cigarettes.

According to the Sydney Morning Herald this week, excise on a pack of 20 climbed from $8.13 to $9.25, an increase of $1.12, while excise on a pack of 40 cigarettes climbed from $16.26 to $18.51.

In December 2013, the Government applied the first of four annual 12.5% tax increases. It was followed by the March 1 introduction of biannual average weekly ordinary-time wages, under which tobacco excise rises in line with wages, instead of the slower-growing consumer price index.
Meanwhile, Australian Association of Convenience Stores (ACCS) CEO Jeff Rogut has taken issue with Cancer Council of Victoria research, which stated that illicit tobacco isn’t any more prevalent since plain packaging began.

The tobacco industry view is that illegal cigarette smuggling is up since plain packaging. Illicit tobacco trade is currently 13.3% of total consumption and accounts for approximately $1 billion in lost revenue to the government, according to Imperial Tobacco.

“For an understanding of the actual impacts of plain packaging, in terms of illicit trade of tobacco and the imposts on small business, you need to go to the source, retailers themselves”, Mr Rogut said.

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