One Nation vows to bring back cheaper legal cigarettes

One Nation, a political party in Australia, is urging the Labor government to significantly reduce the tobacco excise tax, which they claim will help combat organized crime. Currently, the excise tax adds $1.53 to the cost of a single cigarette, amounting to around $2,500 per kilogram of tobacco, with an additional increase set for September. One Nation's leader, Pauline Hanson, has vowed to cut the excise by 75%, bringing it back to a level similar to September 2015.

Hanson argues that raising the tobacco excise tax has contributed to the growth of illicit trade, where a large portion of the tobacco market is estimated to be worth billions of dollars. She believes that increasing the price of legal cigarettes makes it more appealing for young people to buy illicit cigarettes, which is concerning for her party.

Barnaby Joyce, a One Nation MP, stated that constantly raising the price of cigarettes and expecting more tax revenue is "absurd economics" and that it will only lead to more mafia involvement. He argued that bringing back the price of legal cigarettes to the same level as illicit ones is the only solution to deal with the criminality.

Recent statistics show that 80% of all tobacco consumed in 2025 is illicit, a significant increase from 12% in 2017. This illegal trade has become a major concern, particularly in Victoria, where over 200 arson attacks related to the "tobacco wars" have been reported in the past three years. The firebombing of tobacconists has become a contentious issue leading up to the Victorian election, where One Nation hopes to gain multiple seats in parliament.

Federal Labor has so far been hesitant to change the tobacco tax, despite calls from NSW Premier Chris Minns to intervene in July. Treasurer Jim Chalmers has dismissed the calls to address the problem with an economic approach, emphasizing the focus on law and order aspects of the issue. The government has reported successful raids on illegal supply, attributing the success to increased funding for policing.