Australia debates tobacco tax cuts to combat illicit trade

Australia is facing a significant policy debate regarding its tobacco excise duties and the rise of an organized crime-driven black market. High taxes have been linked to a multibillion-dollar illicit cigarette market, prompting calls from politicians and economists for tax reductions to curb illegal sales.

One Nation leader Pauline Hanson has proposed slashing the tax on a packet of cigarettes by $30 to combat organized crime. Some economists, including Richard Holden from the University of NSW, have suggested a temporary complete removal of the excise to eliminate the illegal market, while others argue that current bipartisan policies have created a “wicked public health challenge.”