Australia Senate inquiry recommends major tobacco excise cuts

A Coalition-led Senate inquiry in Australia has recommended significant reductions to tobacco excise to combat a surging illicit market. The report suggests slashing excise by up to 80 per cent, arguing that current tax levels have outpaced inflation and driven consumers toward organized crime. Stakeholders, including the Australian Association of Convenience Stores, claim that illegal tobacco and black-market vapes now account for a massive portion of the domestic market.

The inquiry chair, Senator Leah Blyth, stated that existing tobacco control measures must be re-evaluated as the current strategy faces a breaking point. Proposed measures include tougher policing of ports, public health campaigns, and traceable cigarette packaging. Some witnesses suggested returning tax levels to 2019 standards or implementing a 40 per cent cut.

The Labor Party has dismissed the inquiry as a political stunt, accusing the Coalition of favoring ‘big tobacco’ interests and risking increased nicotine addiction among youth. Labor senators argued that the illicit trade was already expanding before the Coalition lost office in 2022 and expressed concern over donations received by the opposition from the tobacco industry. The debate also involves One Nation, which is advocating for a 75 per cent excise cut.