Big tobacco threatens to slash prices in Australia

May 17, 2011 by Martin Parry

The tobacco industry on Tuesday threatened to slash the price of cigarettes if Australia goes ahead with plans to introduce plain packaging, saying more people will end up smoking.

Last month, Australia unveiled the world's toughest laws on tobacco promotion that would see cigarettes sold in drab olive-green packets plastered with graphic .

Under proposed legislation, due to take effect next year, all logos will be removed from cigarette packaging, and must print their in a specific font.

British American Tobacco launched a national media campaign against the "unproven plans" Tuesday, with its Australian chief executive David Crow warning of a boom in the black market.

"When all cigarette packs look the same and lose their trademarks and distinguishing features, counterfeiters will have a field day mass producing packets to smuggle into Australia," he said.

"Could (the price of) cigarettes halve over time? In the longer term, potentially yes," he added, saying the cheap prices "basically means more people will smoke, more kids will smoke".

"It's going to backfire and go bad and lead to more people smoking, which is just mad if you're sitting at a government desk," he told the Melbourne Herald Sun.

In a statement, Crow said there was no evidence that plain packaging would reduce smoking.

"What proof does the government have that their plain-packaging experiment will work?" he said.

"Can the government give a 100 percent guarantee that taxpayers' dollars won't be wasted on legal fees and compensation?"

Canberra says 15,000 Australians die of smoking-related diseases every year, and that costs the country Aus$31.5 billion ($32.9 billion) annually in healthcare and lost productivity.

Although Australia would be the first country to mandate plain packaging for cigarettes, New Zealand, Canada and Britain have considered a similar policy.

The move has infuriated the industry, with Imperial Tobacco Australia already saying it planned to challenge the move on the grounds that it would impact profits.

British American Tobacco says the proposed legislation, which still needs to be approved by parliament, would infringe international trademark and intellectual property laws.

Health Minister Nicola Roxon said she expected big tobacco to fight in the courts, but vowed the government would not back down, adding that the excise could be raised if cigarette prices fall.

"I think we are in an extraordinary position where they say they want to protect their brands and profits but then they say they will slash prices to get people hooked onto smoking," she said.

"I mean this really is turning into a little bit of a nonsense argument from them.

"This (plain packaging) is one way that we know we can actually reduce the harm caused to people by smoking, we can free up money spent in the health system."

The Cancer Council said the industry "scare tactics" meant it was seriously worried.

"This desperate threat from the industry should send a clear message to anyone who questions the evidence on whether plain packaging will work," Ian Olver said.

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Noumenal
not rated yet May 17, 2011
"This desperate threat from the industry should send a clear message to anyone who questions the evidence on whether plain packaging will work," chief executive Ian Olver said.


Yeah? I think they're more worried that people will move to another brand because their packet association has been removed, costing them money.
Huyton
3.4 / 5 (5) May 17, 2011
You want to be serious about stopping people from starting to smoke? Then ban sales of cigarettes to anyone born after January 1, 1993. Add a checkbox to a drivers license (or other government issued ID) indicating tobacco usage, and no change from non-user to user allowed when the license is renewed.

With no new addicts coming along, and the current ones either dying off or quitting, the problem will resolve itself eventually.
frajo
3 / 5 (2) May 17, 2011
Are the Australians still fighting the Afghans?
Must be funny to hear the officers shout "stop that smoking, kids, it's too dangerous".
Roland
3.7 / 5 (3) May 17, 2011
Don't ban cigarettes or anything else! That just makes them into "forbidden fruit". If any product needed regulation, it's a product that is a)poisonous, and b)meant for internal consumption. So I suggest the AU govt. pass an automatically-adjusting tax, setting a minimum retail price for a pack. Let these corps. lower the price to dealers all they want, but keep the retail price the same, with the resulting tax split between a)enforcement against tax-avoidance schemes and b)public education on this subject.
TheGhostofOtto1923
1 / 5 (4) May 17, 2011
"Could (the price of) cigarettes halve over time? In the longer term, potentially yes," he added, saying the cheap prices "basically means more people will smoke, more kids will smoke".

-So when threatened the industry threatens to addict more victims. Figures.

"When all cigarette packs look the same and lose their trademarks and distinguishing features, counterfeiters will have a field day mass producing packets to smuggle into Australia," he said.

-So its harder to print bogus colored packs with logos on them than without? Another lie.

"What proof does the government have that their plain-packaging experiment will work?" he said.

-Well I guess its just one of those things theyll have to try out for a few years before they know for sure. Too bad pushers. Too bad smokers. You breathe DIRT because youre addicted to it. Youre ALREADY losers.
daniel_ikslawok
5 / 5 (1) May 19, 2011
Hey, who hasn't been addicted has no idea what it means, to be addicted. So please don't call us losers :)
And I think to ban something is never a good idea, because then a black market will be created, making the forbidden even more attractive to teenagers.
After moving from Germany to England I learned what helps the best: increase those prices!! I paid five Euros a pack, now I'm paying 7 Pounds (which is 8 Euros) for even less cigarettes and I smoke fewer and fewer cigarettes. Make them cost 20 Pounds and I'm sure, a lot of people will quit or even better, not start in the first place!
TheGhostofOtto1923
1 / 5 (3) May 19, 2011
There are plenty of ways to quit. You're losing money, strength, health, and Time. We all give up our addictions sooner or later, one way or another.
jonnyboy
1 / 5 (1) May 21, 2011
There are plenty of ways to quit. You're losing money, strength, health, and Time. We all give up our addictions sooner or later, one way or another.


Ain't none of your business, sonny.
that_guy
not rated yet May 24, 2011
I think huytons idea is rather clever. make it so that it will be illegal for those who are too young as it is to buy cigarettes ever. lets face it, a lot of us like cigarettes because we are really addicted to them. Most of us wish it were easier to quit by the time we hit mid 20s. If it is difficult to get enough cigarettes to smoke a regular amount, it would be easier to kick, or a little harder to get addicted.

as for the article, I think it's hilarious. If the cigarette companies lower prices, that will more than overcompensate for the packaging.

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