Coalition Vows to Slash Tobacco Excise by 80 Percent to Tackle Black Market

A photo illustration of black market cigarettes displayed in Melbourne, Australia, on March 26, 2025. Asanka Ratnayake/Getty Images

Opposition Leader Angus Taylor has vowed to cut the tobacco excise by 80 percent and re-legalise vapes if the Coalition wins the next election.

The policy promise comes just weeks after One Nation vowed to slash the excise by 75 percent and pause indexation for three years to curb the illicit tobacco trade.

In Australia, tobacco products are taxed both to raise revenue and discourage consumption by increasing prices.

Authorities also index the tobacco excise rate to average weekly earnings to ensure tobacco products do not become more affordable over time.

For every kilo of legally sold tobacco product, the government receives more than $2,500 in taxes.

But rising prices for legal tobacco have also fuelled a boom in the black market, which Taylor has described as “a national organised crime crisis.”

“We need to destroy the business model,” he told Sunrise program.

“We need to ensure we take away the profits, take away the customers, and hit what is left with the full force of the law.”

Taylor said existing policy had “failed,” supporting organised crime and the sale of illegal cigarettes, which can be bought cheaply for $10–$15 a pack.

“We’re very confident at an 80 percent cut, we will smash the business model of the criminal gangs who are supporting illegal tobacco,” he said.

“We’ve been working closely with the parliamentary budget office, we know that is the point at which that business model simply doesn’t work anymore.”

Concerns Nicotine Addiction Could Rise

But the plan has attracted criticism from health groups such as the Cancer Council Australia (CCA), who says plans to cut the excise on tobacco risk creating a new generation of nicotine addiction.

Australia currently has the lowest smoking rate in the nation’s living memory, with recent data from the National Drug Strategy Household Survey showing only 5.6 percent of people aged 14 and older smoke.

CCA Director of Cancer Control Policy David Martin said the numbers were the result of decades of public health policy.

“Sixty-six people will die today from smoking,” he said in a statement provided to The Epoch Times.

“We should be asking how we further drive down smoking, not how we make cigarettes and nicotine products more available and socially acceptable.”

Meanwhile, Dr. Liam Egan, medical lead at “Quit,” said legalising vapes came with risks.

“Quitline receives calls from young people addicted to vaping and pouches, and struggling to quit,” he said.

“We don’t want to make these harmful, addictive nicotine products easier to access. At the very moment, we should be doing everything possible to prevent another generation becoming hooked.”