The federal government says the big tobacco deliberately vulnerable young people by selling cheap cigarettes. British American Tobacco Australia (BATA) has released a budget brand called Just Smoker which retails for $ 11.50 per pack of 25.
This is much lower than the average price of $ 16 and only slightly higher than the illegal counterfeit goods. BATA says he was forced to go down market, because the government’s decision to increase excise duty of 25 per cent in 2010 led to a massive increase in cheap cigarettes and smuggling.
But Health Minister Tatyana Plibersek does not buy that argument. “By reducing our prices are British American Tobacco seems to be directly aimed at vulnerable young people,” she said in a statement today. “We know that young people are the most price-sensitive smokers all.”
Minister of Health said BATA movement was “very disappointing” and counterfeit cigarettes, while there were tobacco companies overstated their presence as an excuse to push their own products more difficult.
The prohibition of cigarette advertising, which makes it illegal to sell smokes minors, the introduction of graphic health warnings and excise hikes led to a significant reduction in smoking, Ms Plibersek said.
BATA Representative Scott McIntyre said that the government is to blame for the price war by increasing the excise tax. Cheap price segment of the market has grown 63 percent since 2010, he said in a statement.
“Our customers were to trade for cheaper products or illegal cigarettes so we were forced to compete. “If the government continues to give us a specific increase in the excise duty as it did in the past, all they do is making the problem worse.”
Mr. McIntyre later admitted on ABC Radio, which is more cheap cigarettes, is likely to lead to an increase in the numbers of people lighting. “One would think (so) if the prices keep getting cheaper and cheaper, and there is huge growth in this area.”
Responding to a question whether the government would simply increase the excise tax back against BATA to move Ms. Plibersek said: “We will continue to look at what we have to do to continue to reduce the rate of people smoke in Australia.”