One Nation wants to cut the tobacco tax. Would that curb the illicit cigarette market?
A 75% cut in tobacco tax won’t make cigarettes as cheap as you might think. Here’s what really helps smokers in a cost of living crisis.
Pauline Hanson, the leader of One Nation, has proposed a 75% reduction in the tobacco tax, accompanied by a freeze on price indexation for three years. This move would reportedly lower the cost of a packet of cigarettes from around A$46.50 to approximately $21 or $22, assuming the full tax cut is passed on to consumers. However, the feasibility of this proposal is questionable, as tobacco companies, not governments, determine the retail price of cigarettes, and there is no legal mandate for them to lower prices in response to a tax cut.
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