Cigarette & tobacco price increase in Australia - September 2017

  • 4 min read


On 1 September 2017 the price of cigarettes & tobacco in Australia increased ... AGAIN! And prices are going to get even higher every six months. 

The Australian Government has applied several taxes to cigarettes and tobacco products with the aim to reduce the number of people smoking and discourage people from taking up smoking in the first place, particularly younger people.

We all know that smoking is bad for your health and is a known cause of a range of cancers and respiratory illnesses ... but giving up the smokes is not easy and the increasingly high prices for cigarettes and tobacco is hitting people really hard. There's never been a better time to stop smoking and start vaping!

Why are cigarettes & tobacco so much more expensive in Australia than the rest of the world?

Australia is a party to the World Health Organisation (WHO) Framework Convention on Tobacco Control (FCTC) and is obliged to implement these price measures to reduce the demand for tobacco. In Australia the main taxes applied to the cost of every packet of cigarettes or rollies are:

  • Customs tax - In 2006 the Australia Government stopped issuing commercial production licences for growing tobacco. No one is licensed to grow tobacco for commercial sale or personal use in Australia. All tobacco sold here has been grown in another country, is imported and subject to customs tax.
  • Excise tax for tobacco - also called "duty" this is a tax on the use or consumption of certain products (such as cigarettes, alcohol & petrol) which is included in the price of the product.
  • Average Weekly Ordinary Time Earnings tax (AWOTE) - Australia is the only country in the world to index tobacco excise to wage inflation (average weekly earnings, not including over-time). This is an extra tax implemented to ensure that tobacco products do not become relatively more affordable over time.
  • GST - 10% Goods & Services Tax is paid on top of all other taxes 

The WHO recommends that the tobacco excise taxes should cover at least 70% of the retail cost of tobacco products, before other taxes like GST are added. With all these tobacco taxes in Australia, it's fair to say that we've got this covered!

Why has the cost of cigarettes & tobacco just increased?

On 1 September 2017, the excise tax for tobacco and related products increased by 12.5%. The price of cigarettes has increased so dramatically over the last few years because:

  • in 2013 the Australian Government first introduced an annual 12.5% excise tax increase on cigarettes
  • on 1 September every year since then, an additional 12.5% excise tax increase has applied to cigarettes
  • a further 12.5% excise tax increase will also be added on 1 September 2018, 2019 and 2020.

On top of this, the AWOTE tax rates on tobacco (that's Australia's own extra tobacco tax mentioned earlier) increases twice every year on 1 March and 1 September. 

What this means is that on 1 September 2017, the cost of cigarettes and tobacco had a double tax hit. The way things are going, before too long people will be heading to their local loan shark (oops ... pay day lender) just to buy a pack of smokes!  


I'm still smoking, what does this mean to the cost of cigarettes? 

For any smokers out there, your favourite taylor made brands have never been so expensive. From 1 September 2017, here's the recommended retail prices for some popular cigarette brands:

Peter Stuyvesant 25s - $32.50

Winfield 25s - $32.75, 40s - $48.45

Peter Jackson 20s - $25.45, 40s - $46.50

Marlboro 20s - $26.60, 25s - $32.75

Horizon 20s - $21.95, 40s - $46.50

Holiday22s - $22.70, 50s - $51.90

Wouldn't it be cheaper to just buy rollie tobacco instead? 

Sadly not. The Australian Government is increasing taxes on roll-your-own tobacco at a higher rate to bring prices in line with taylor made cigarettes. The price per kilo of loose tobacco increased from $771.60 on 1 March 2017 to $901.39 on 1 September 2017.

After 1 September 2017, here's the recommended retail prices for some popular rollie brands:

Peter Stuyvesant 30gm - $46.75

Winfield 20gm - $29.55, 50gm  - $70.60

Drum 30gm - $43.00, 50gm - $71.00

Champion 25gm - $36.00, 50gm - $71.00

Horizon 25gm - $34.00, 50gm - $67.00

Holiday 25gm - $34.45, 50gm - $68.15

If you can't go cold turkey, there's never been a better time to stop smoking & consider vaping

Like so many of you, the Vape Bureau team have made the switch from smoking to vaping and simply haven't looked back. We're mixing away at the moment to create new e juice flavours that will hit the spot for starter vapers and are also testing out new vaping devices. Very soon we will be releasing our own range of tobacco flavoured e juices and starter devices that are suitable and easy to use for people making the switch to vaping. 

Quitting the smokes is hard, but so is parting with so much of your hard earned cash to buy them. The cost of cigarettes is only heading in one direction, so why not make a positive change to your back pocket and your health? 


Want more information? Check out these links ATO Excise Rates for Tobacco, Department of Health Tobacco Excise