Packets of legal cigarettes in Australia could see a price reduction of approximately $20 as part of a new plan proposed by One Nation to combat the illicit tobacco trade. The party’s leader, Pauline Hanson, argues that reducing the current excise by 75% and pausing indexation for three years will not encourage smoking but will instead target organized crime. Currently, about 80% of nicotine consumption comes from illicit sources, and the party claims that the average legal packet of cigarettes, which includes an excise of around $30.60, contributes to this shift. Under One Nation’s policy, the cost of a legal packet could drop from $46.50 to between $21 and $22. The proposal also includes enhanced border enforcement and stricter penalties for tobacco traffickers.
Why It Matters
This proposal reflects ongoing challenges in regulating tobacco markets in Australia, where rising excise rates have driven many smokers to the black market. Historical data shows that, between 2017 and 2025, total nicotine consumption increased by nearly 40%, with the Australian Bureau of Statistics estimating that illicit sources supplied a significant majority of the market. The decline in excise revenue, projected to fall from $12.6 billion in 2022-23 to an estimated $4.1 billion by 2025-26, indicates a substantial impact on government finances and raises concerns about the effectiveness of current tobacco policies. The interplay between high tobacco prices and organized crime continues to be a critical issue in public health and law enforcement.
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