Australia's skyrocketing cigarette prices are sparking a "tobacco war" and fueling the black market, depriving governments of billions of dollars in tax revenue, experts warn.
At 29 euros for a pack of 25 cigarettes, many smokers are turning to the contraband market, escaping the indirect tax on tobacco, Australian Finance Minister and Treasurer Jim Chalmers recently lamented.
In March, Canberra cut its forecast for tobacco tax revenue by four billion euros by 2029.
"It's a fiscal crisis, so we're losing billions and billions of dollars in excise duty (indirect tax, editor's note) but also, what worries me more (...), is that it has become a major crime problem," warns James Martin, professor of criminology at Deakin University in Melbourne (southeast).
Since the beginning of 2023, more than 220 arson attacks have targeted black market dealers or shop owners who refused to sell illicit tobacco products, according to Mr. Martin, who denounces acts of "extortion" and "intimidation."
Australia prides itself on being at the forefront of tobacco control. In 2012, the country became the first in the world to introduce plain cigarette packaging.
– “Hemorrhage” –
Criminals fighting for control of the "lucrative" illegal tobacco market are behind "violence," according to Heather Cook, director general of the Criminal Intelligence Commission.
And law enforcement can't solve the problem alone, Martin says, because "if we make it harder to get nicotine, people will turn to the black market."
According to the criminologist, Canberra made two mistakes: increasing the price of cigarettes to such an extent that at a rate of one pack a day, a smoker's bill climbs to around 8,700 euros per year; and also restricting the sale of e-cigarettes to pharmacies only.
"The government must lower the indirect tax on tobacco to stop the flow of tobacco to the black market, and must legalize vaping products," Martin argued.
The teacher points to neighboring New Zealand, the only country to have introduced a similar level of tobacco taxation to Australia, but which legalized e-cigarettes in 2020. "New Zealand had a higher smoking rate than us just four years ago. It's now considerably lower than Australia's," he says.
- " War " -
Contraband cigarettes arrive in Australia from China and the Middle East, and e-cigarettes mainly from Shenzhen in southern China, according to the criminologist.
And this market is thriving: Australian Border Police reported seizing 1.8 billion cigarettes and more than 436 tonnes of illicit tobacco leaves between July 2023 and June 2024.
Smoking has declined significantly in recent decades in the continent-country, from 24% smokers among those over 14 in 1991 to 8.3% in 2023, according to a public survey.
But nicotine consumption per person has been "relatively stable" since 2016, according to a survey by the Australian Institute of Health, which looked at traces in wastewater of this addictive molecule present in cigarettes, e-cigarettes and tobacco substitutes.
According to Edward Jegasothy, a professor of public health at the University of Sydney (east), whether prices are stable or significantly increasing, the proportion of smokers in Australia has fallen at the same rate.
The black market is detrimental to public policy because it offers cheaper alternatives, the expert told AFP, advocating a reduction in tobacco taxes and increased police controls.
Mr. Jegasothy also points out that tobacco tax policy primarily affects the most disadvantaged socio-economic groups, those most exposed to smoking and who spend a larger proportion of their income on cigarettes.
"There is little evidence to suggest that our de facto war on nicotine is an optimal strategy for reducing nicotine-related harm," Jegasothy and Martin warned recently in a scientific paper.
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