Australian cigarettes to cost more; Smokers Down Under filling government coffers with taxes

By @ritwikroy1985 on
Cigarettes Australia
A woman smokes a cigarette outside an office building in central Sydney June 27, 2011. Reuters/Daniel Munoz

Aussie smokers are helping the government to fill up tax coffers. Cigarettes in Australia already cost a bomb and they are set to become more expensive. Currently, a cigarette contributes 53.7 cents to the Federal Government. In another five years, this figure will go up to 80 cents per cigarette, thanks to a series of planned tax increases.

According to Herald Sun, Aussie smokers contribute a staggering $8 billion into government coffers every year. Smokers are also more likely to suffer from medical conditions such as emphysema than non-smokers.

However, compared to the $8 billion dollars in revenue, smokers today represent a yearly burden to the health system of about $3 billion every year. The figure is adjusted to the present day after considering a study by researchers Collins and Lapsley, titled “The costs of tobacco, alcohol and illicit drug abuse to Australian society in 2004-05.” The Cancer Council of Victoria frequently quotes figures from this study.

The study states “gross health costs attributable to smoking, before adjustment for savings due to premature death, were $1.836 billion.” Of course, the figures do not consider the loss relatives and friends face when smokers close to them die, often prematurely. The study also does not take into account the productivity loss that results when a smoker takes a break from work for lighting up.

However, what the study does state is that tobacco tax revenues from smokers considerably exceed the healthcare costs associated with smoking, which is borne by the government.

Smoking is a lethal habit and no good comes out of smoking. Therefore, government may increase prices of cigarettes to deter smokers from quitting but at the same time the already-strained Federal Budget gains a lot from smokers.

Thus, every time one buys a cigarette pack, he/she is actually contributing to government coffers at the cost of his/her own health.

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