The Labor Party wants a pack of 25 cigarettes to cost more than $40 in five years’ time. It currently costs around $25-$30.

A new plan will take cigarette costs to a new level by 2020. The tax on cigarettes is going to increase after 2017 in case Labor forms the government. The Parliamentary Budget Office has plans to raise $3.8 billion over the forward estimates and $47.7 billion over the medium term, Herald Sun reported.

According to the Opposition, the policy is likely to save around $50 billion over the medium term. It argues it will nearly double the rate of quitting the smoking habit.

"Money that we want to put towards budget consolidation but also towards very important health initiatives," the ABC quoted Labor's health spokeswoman, Catherine King, as saying. "We have some 2.5 million Australians who continue to smoke and we lose about 15,000 people a year from smoking-related diseases."

King said the new policy would help people quit smoking. "The World Health Organisation will tell us, as our own national tobacco strategy does, that you do need to continue to ramp up the excise on cigarettes if you are going to continue to drive smoking rates down," she said.

According to Opposition Leader Bill Shorten, the new policy is what separates the ideologies of the government and the Labor Party.

"Labor wants to reduce the number of people who smoke; Malcolm Turnbull's Liberals want to increase the GST and the cost of everything, including fresh food, school fees and going to the doctor," he said.

Caucus members in the party, however, questioned the logic behind the policy. One Labor MP argued that there were many smokers among the party’s voters.

In countries like New Zealand, France and the United Kingdom, at least 75 percent of the cost of a pack of cigarettes is accounted for taxation.

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