Introduction by Croakey: Australia’s political processes remain acutely vulnerable to tobacco industry interference and influence, public health experts warned earlier this year.
They detailed tactics such as political donations (the National Party continues to accept tobacco money), the revolving door of industry lobbyists who’ve previously worked in government, and the use of front groups.
These concerns were raised in May after tobacco giant Philip Morris Limited was not only invited to give evidence to a Senate inquiry into the illegal tobacco crisis, but was permitted to do so behind closed doors without any public scrutiny.
Philip Morris was also permitted to give evidence behind closed doors to a New South Wales state parliament inquiry into the illegal tobacco trade in late February.
Australia signed the World Health Organization’s Framework Convention on Tobacco Control in 2003, whose implementation guidelines explicitly call for interaction with the industry to be minimised and transparent.
Having these sessions behind closed doors meant Philip Morris could lobby privately for policies that would directly benefit the company, such as cutting tobacco taxes, the researchers warned.
In the end, the Liberal-led Senate inquiry recommended cutting tobacco excise; however, Labor and Greens Senators, in separate dissenting reports, opposed both this recommendation and the tobacco industry’s involvement in the inquiry.
The industry has long campaigned against such taxes, which were described in a 1999 World Bank report, Curbing the Epidemic, as the most effective and cost-effective measure to reduce tobacco use and save lives.
“Over the two decades since, the evidence base supporting this claim, especially in low- and middle-income countries, has been steadily growing,” says a World Health Organization manual on tobacco tax policy and administration.
“The evidence is clear: significant increases in excise taxes that lead to price increases have consistently proven to be the most effective, as well as the most cost-effective, mechanism for reducing tobacco consumption,” says the manual.
Fast forward to this week, and the Federal Opposition has announced plans to cut tobacco excise by 80 percent, as part of “a major law and order policy”, headlined, ‘To Kill The Illicit Tobacco Market And Smash The Gangs’.
One Nation has also promised to slash the tax on tobacco by 75 percent, saying their policy would reduce the price of a $46.50 legal packet of cigarettes to around $21 to $22.
Simon Chapman AO, Emeritus Professor in Public Health at the University of Sydney, has described “reduce the tax” proposals as “commercially illiterate brain farts, devoid of the most elementary arithmetical argument and coated with staggering ignorance about the global trade in illegal tobacco”.
Below, the Australian Council on Smoking and Health, Public Health Association of Australia, Australian Medical Association and Australian College of Nursing respond to the Coalition’s policy announcement with alarm, describing it as reckless and harmful.
Fuelling nicotine addiction
The Australian Council on Smoking and Health (ACOSH), which includes Australia’s major health organisations, is deeply concerned that the illicit tobacco crisis is being used as a justification to wind back decades of successful tobacco control measures, with the Coalition’s proposed policies risking higher smoking rates and ultimately costing Australians far more than the price of a packet of cigarettes.
The Coalition has proposed cutting tobacco excise by 80 percent and legalising commercial sales of vapes and pouches. ACOSH says these measures would not dismantle organised crime networks or close stores selling illicit tobacco and that there is no independent modelling or evidence to support the Coalition’s policies.
“Slashing tobacco excise and expanding commercial vape sales will not stop criminal networks from importing, distributing and selling illicit products,” said ACOSH CEO Laura Hunter.
“What we do know is making cigarettes cheaper will mean more smoking and fewer quit attempts, particularly among young people who are highly sensitive to price.”
Hunter said the illicit trade is driven by global mass production and sophisticated criminal supply chains. Governments can never price match organised crime that can make a pack of illicit tobacco for $0.28.
ACOSH has consistently called for a multi-pronged response to the illicit tobacco crisis, including far stronger border controls, better-resourced enforcement, tougher penalties, nationally consistent retail licensing reforms to reduce the number of outlets, and free nicotine replacement therapy for people trying to quit.
They say one of the big opportunities is tightening the supply chains criminal networks are exploiting and becoming more restrictive about how this deadly product is imported and sold in Australia.
ACOSH supports licensing only businesses that can demonstrate strong security, governance and product traceability.
“We need a smaller, more compliant retail environment where enforcement is easier and illicit sales are harder. More than 60 per cent of shops subject to NSW closure orders for illicit tobacco are licensed to sell tobacco legally. That’s not a licensing system doing its job.”
ACOSH, along with organisations including the Australian Medical Association, Lung Foundation Australia, Cancer Council Australia, Quit, the Thoracic Society of Australia and New Zealand, and the Public Health Association Australia also rejects calls for a commercial vape market, noting that adults can already access regulated therapeutic products for smoking cessation through pharmacies.
“The Cochrane review shows regulated nicotine vapes may help some smokers quit, but it does not support selling them through convenience stores, tobacconists or a commercial retail market.
“A retail vape market proposal asks parents, teachers and communities to accept greater youth exposure to nicotine so the industry can replace the customers it loses every year to quitting, disease, and death.”
ACOSH said the Coalition’s proposal risks adopting the story long promoted by the tobacco and nicotine industry.
“The idea that Australia’s challenge is simply ‘illegal’ tobacco and ‘illegal’ vapes is precisely the framing the tobacco industry wants policymakers to adopt. It is telling that there is nothing in these proposals that meaningfully address the needs of the 90 per cent of smokers who say they want to quit.”
“This crisis should be an opportunity to be bold. Australians need to decide what kind of future we want: one with more smoking, more nicotine addiction and vape stores back on every street corner. Or do we want to be bold and accelerate the end of Australia’s deadliest consumer product? We believe it’s time to say enough is enough.”
Potential disaster
The Public Health Association of Australia is alarmed at Coalition and One Nation proposals which risk increasing the uptake of nicotine addiction by children and slowing rates of quitting by adults.
Australia has been winning the long fight to bring down nicotine addiction, with daily smoking prevalence down to 5.6 percent by 2025, and regular vaping use stabilising after a decade of growth at 3.6 percent.
Australia does not have a counter sales tax on tobacco products, only a customs duty.
The proposed 80 percent tax cut for international tobacco companies that import tobacco products into Australia means any cut to the import tax will only boost the profits of tobacco companies, with no change to tobacco prices – unless these companies choose to pass on the cut rather than building up their profits.
There is no evidence an 80 percent cut will eliminate the illegal market. It won’t raise revenue, and won’t fight nicotine addiction.
If tobacco importers did lower their product prices, and the criminal sector followed suit, the result could be disastrous.
The costs of tobacco go well beyond the price of the packet: illness, medications, hospital appointments, time away from work, burdensome caring responsibilities, lost income, and – tragically – premature death. Those costs are carried by families, communities and our health system.
Reducing tax risks deepening inequities. At a time when we rightly focus on housing and the cost of living, we should remember that health is absolutely essential to a good quality life.
Ninety percent of nicotine addiction begins before the age of 18.
Young Australians are well aware of the health risks of nicotine addiction, and over 90 percent of them reject it – but price and policy settings can influence uptake and shape social norms.
Young people don’t need to be betrayed by political leaders surrendering to tobacco industry interests. Parents should not be betrayed in their daily attempts to protect their kids.
PHAA continues to call on all Australian politicians to put first and foremost the health and safety of Australia’s young people. PHAA also calls on all political parties to refuse to take donations from tobacco industry interests. Read the PHAA policy on tobacco control.
Reckless and dangerous
The Australian Medical Association said the Federal Coalition’s reckless proposal to slash tobacco excise by 80 percent and make vapes more accessible would undermine decades of public health efforts and could drive more Australians back to smoking.
AMA President Dr Danielle McMullen said the decision by the Coalition to align its policy with One Nation’s tobacco excise policy defied both evidence and common sense and was the kind of masterplan dreamt up by big tobacco executives.
“Making cigarettes more affordable is not the answer to tackling the illicit tobacco trade and would undermine Australia’s world leading public health efforts to reduce smoking,” McMullen said.
“Tobacco taxation has been a major contributor to Australia’s historically declining smoking rates,” she said.
“Lower cigarette prices would likely increase smoking rates, particularly among price-sensitive groups such as young people and people experiencing socioeconomic disadvantage, widening health inequities.”
McMullen said the Coalition appeared to be prioritising a simplistic political fix over evidence-based public health policy, despite tobacco remaining one of Australia’s leading causes of preventable death and disease.
“There’s also very limited evidence that dramatically cutting tobacco taxes is an effective long-term public health strategy, and it could result in increased legal tobacco consumption even if illicit trade falls.
“The illegal tobacco trade has flourished in countries where cigarettes are far cheaper than in Australia and there is no evidence reducing the excise will affect that trade.”
Reducing the tobacco excise as a way of tackling the illegal tobacco industry was a simplistic, misguided and ineffective solution to a complex problem, McMullen said.
“Canada halved its tobacco excise to combat smuggling across the US border, but the move led to more people, particularly young people smoking, and fewer people quitting.
“Meanwhile the illegal trade persists even in countries with much cheaper cigarettes, including in countries like Vietnam, the Philippines and Senegal where tobacco is very cheap.
“If we look to the United Kingdom, when taxes on tobacco were introduced, the illicit trade rose but instead of cutting taxes under pressure from the tobacco industry, the government kept the tax and implemented a comprehensive enforcement strategy and the size of the illicit trade of tobacco declined.
“There are alternative approaches to combating illicit tobacco that do not require making cigarettes cheaper, including stronger border enforcement, supply-chain controls, retailer licensing, intelligence sharing, and targeted criminal enforcement.”
Meanwhile, McMullen said legalising nicotine pouches, as proposed by the Coalition, would potentially increase nicotine dependence and create additional pathways for young people to take up smoking.
“The proposal to legalise retail access to vapes will weaken Australia’s recent vaping reforms, which were designed to restrict youth access and strengthen clinical oversight of nicotine vaping products,” she said.
“The overseas evidence is clear, vaping is a pathway to smoking and the Coalition’s plan will do nothing more than get future generations hooked on nicotine.”
Further reading
The Guardian: Experts weigh in on how to tackle illicit tobacco – and why an 80% excise cut is not on their list
Professor Simon Chapman: Lowering tobacco tax for dummies
See Croakey’s archive of articles on tobacco control
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