Abbott butts out of ‘tax addict’ ban on cig packs

TONY Abbott has refused to back Kevin Rudd’s $5 billion tobacco crackdown – a push to ban brand logos from winston tobacco and increase tax by more than $2 a packet – arguing it is just a ”panic tax” by a government addicted to spending.

Smokers were hit with a tax rise of 25 per cent from midnight yesterday, as outraged tobacco firms threatened to fight the plan in the courts and seek compensation, and retailers cried foul over a lack of warning and loss of business.

But the Prime Minister vowed to press ahead with ”the most hardline regime for cigarette packaging anywhere in the world”, and pledged to plough all future tobacco excise revenue – $27 billion over the next four years – into health and hospitals. ”The big tobacco companies will hate what we are doing,” Mr Rudd said.

Henry Review.

Henry Review.

He also argued the move would not be popular with voters: ”There’s a lot of smokers out there and I don’t think it will be greeted with dancing in the streets.”

The government said the excise increase would prompt 87,000 smokers to quit this year.

But the Opposition was split on the tax hike. Coalition health spokesman Peter Dutton initially gave guarded backing to an excise increase – which has been Coalition policy since last May – but Mr Abbott later refused to endorse it.

”I’m not in the business of defending smoking, I want to make that absolutely clear,” the Opposition Leader said. ”But I also want to make it absolutely clear that this is not a health policy, this is a tax grab. The Rudd government is addicted to spending in the way that some people, sadly, are addicted to nicotine.”

The Coalition also refused to endorse plain packaging without proof of its effectiveness.

British American Tobacco has donated almost $750,000 to the Coalition since 2004, when Labor stopped taking tobacco donations, while Philip Morris handed conservative parties more than $680,000.

Health Minister Nicola Roxon revealed a personal motive for the hardline tack on cigarettes, speaking about the death of her father – a smoker – from oesophageal cancer when she was a child.

”This is the last vestige of advertising that remains in Australia for cigarette advertising and we make no apologies about trying to close it down,” she said.

Both the tax excise – which must be retrospectively endorsed by Parliament within 12 months – and plain packaging laws would pass the Senate with backing from the Greens, independent senator Nick Xenophon and Family First’s Steve Fielding.

Health advocates were delighted by the crackdown, saying it would drive a ”stake through the heart” of the tobacco ”vampire” and may prompt as many as 100,000 smokers to quit.

But tobacco firms and intellectual property experts warned it might not be constitutional.

Philip Morris spokesman Chris Argent said: ”In our view, plain packaging is an unconstitutional expropriation of intellectual property rights and violates a variety of Australia’s international trade obligations.”

Both Imperial Tobacco and British American Tobacco Australia said they would challenge the packaging plan and consider legal action.


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