Tobacco and vaping control measures

Budget Resources

Dr Matthew Thomas

The Government has committed $511.1 million over the forward estimates, and $101.1 million ongoing, towards a range of measures calculated to help reduce smoking and vaping (p. 154).

The measures form part of the Government’s response to the recently-released National Tobacco Strategy 2023–2030 (the Strategy) along with ‘related initiatives on vaping and smoking prevention and cessation, and an enhanced regulatory approach to vaping’, details of which are included below.

The Budget measures comprise:

  • $263.8 million over 4 years (and up to $101.1 million per year ongoing) to establish and maintain a national lung cancer screening program, through which at-risk Australians will be able to get a lung scan every 2 years
  • $141.2 million over 4 years to expand the Tackling Indigenous Smoking program to include tackling vaping
  • $63.4 million over 4 years for national public health campaigns to discourage people from smoking and vaping, including additional funding provisioned in the Contingency Reserve for a targeted youth campaign
  • $29.5 million over 4 years to increase and enhance smoking and vaping cessation support and
  • $13.3 million over 4 years for legislative and regulatory reform, as well as testing tobacco products for prohibited ingredients and increased inspections of manufacturers, importers, wholesalers and retailers of tobacco and vaping products.

Background—tobacco control

Australia is widely recognised as being a world leader in tobacco control. It has, over the years, implemented a comprehensive range of tobacco control measures, including legislating for the plain packaging of tobacco products, which was a world-first reform.

These measures have contributed to a significant decline in the prevalence of smoking, with the rate of daily smoking among Australians aged 14 years and older having more than halved over the past 30 or so years (p. 5). While the daily smoking rate among Aboriginal and Torres Strait Islander people is considerably higher than that for the general population, the proportion of Indigenous Australians smoking daily has also been declining over recent years (p. 64).

Despite smoking rates being at record low levels, much of the decline in daily smoking is a result of increasing numbers of Australians never taking up smoking, rather than smokers quitting.

Tobacco use continues to cause more disease and injury burden in Australia than any other single risk factor, being responsible for 8.6% of the country’s total burden of disease in 2018. An attempt to quantify the social costs of tobacco use to the Australian community (such as reduced economic output due to premature mortality, hospital separation costs and other medical and social care costs) estimated the net tangible costs of smoking in 2015–16 at $19.2 billion (p. 2).

In this context, and having argued that there have been ‘nine years of delay and inaction’ on tobacco control, the Government has indicated that it intends to ‘reignite the fight against tobacco addiction’ with new measures to ‘complement the development of new proposed national tobacco control legislation’.

New tobacco control legislation and measures

On 30 November 2022, the 10th anniversary of the introduction of tobacco plain packaging in Australia, Minister for Health and Aged Care, Mark Butler, announced that the Government plans to consolidate into a single Act all of Australia’s current tobacco measures, along with 11 new measures.

Among other things, the proposed measures will:

  • update and improve the graphic warnings on tobacco products
  • require that individual cigarettes be manufactured in unattractive colours or include printed warnings like ‘smoking kills’
  • standardise the size of tobacco packets and products
  • prevent the use of specified additives, including flavours and menthol
  • standardise the design and look of cigarette filters
  • limit the use of deceptive names on products that imply that they are less harmful, like ‘organic’ or ‘light’
  • require health promotion inserts in tobacco packs and pouches
  • update advertising regulation to capture e-cigarettes and
  • require tobacco companies to ‘be open and transparent about their sales volumes and pricing, product ingredients and emission along with their advertising, promotion and sponsorship activities’.

Subsequently, on 2 May 2023, the Government released the Strategy. The Strategy, which has been endorsed by all states and territories, ‘aims to achieve a national daily smoking prevalence of less than 10% by 2025 and 5% or less by 2030 in Australia, and reduce the daily smoking rate among First Nations people to 27% by 2030’ (p. 9).

Tobacco excise increase

In addition to the above mentioned tobacco-related expense measures, the Budget provides for an annual 5% increase to the tax on tobacco over the next 3 years (p. 11). This is in line with priority area 3 of the Strategy, which is to continue to reduce the affordability of tobacco products (p. 16).

The Government has also indicated that it intends to progressively adjust the taxation of loose-leaf tobacco products (such as roll-your-own tobacco) to match that of the per-stick rate (p. 11). This is to ensure that manufactured cigarettes and roll-your-own tobacco excise rates are comparable.

The excise increase is calculated to raise an additional $3.3 billion over the forward estimates. The increased price of tobacco products is also estimated to translate to a boost in Goods and Services Tax (GST) payments to the states and territories of $290.0 million over 5 years from 2022–23.

While tobacco and tobacco products are subject to biennial indexation and the GST, there have been no additional increases in tobacco excise and excise-equivalent customs duty on tobacco since the last annual 12.5% increase of 1 September 2020 (for background on the annual increases, see the Parliamentary Library’s publication Budget review 2016­–17, p. 63).

Studies of the impact of price increases on tobacco consumption and smoking cessation indicate that higher cigarette prices result in decreased consumption and are associated with increased motivation to quit and successful smoking cessation. Indeed, as the Strategy notes, ‘reducing the affordability of tobacco products through tobacco tax increases is the single most effective measure that governments can adopt to reduce smoking’ (p. 16). According to 2019 National Drug Strategy Household Survey (NDSHS) data, almost 3 in 5 Australian smokers (58%) said the cost of tobacco was motivating them to quit or reduce their smoking (an increase on around 1 in 2 (52%) in 2016) (p. vii).

However, because tobacco is an addictive substance, demand for tobacco products is less responsive to price increases than demand for many other consumer products. Tobacco excise increases are generally understood to be regressive; that is, they impact disproportionately on poorer people who are more likely to be smokers and less able to afford price increases. To the extent that excise increases do reduce tobacco consumption among people from lower socio-economic groups, or encourage them to quit, it may be argued that they are, in fact, progressive. This is because it is poorer people who stand to gain the most, financially and in health terms, from excise increases that provide an incentive to quit or reduce their consumption.

Previous additional annual excise increases contributed to a general reduction in the proportion of Australians who smoke. However, based on evidence that this reduction was not evenly distributed, with people in the most disadvantaged areas now more likely to smoke and paying more to do so, epidemiologist Edward Jegasothy has argued that the excise increase ‘appears to be a revenue grab by the Federal Government dressed up as a public health intervention’. Jegasothy maintains that a more ethical and effective public health measure would involve relieving the financial and social stresses that increase the risk of disadvantaged Australians smoking.

Vaping measures

e-cigarette use

While the rate of tobacco smoking has been falling in Australia, data from the 2019 NDSHS show that the use of e-cigarettes (vapes) is becoming more common. Between 2016 and 2019, lifetime and current use of e-cigarettes increased among both smokers and non-smokers, and across most age groups, but especially among young people.

Many health experts are particularly concerned about the threat e-cigarettes pose to public health in that they could act as a gateway to young people taking up smoking and help to re-normalise smoking.

While now somewhat dated, Australian secondary school students alcohol and drug survey (ASSAD) data for 2017 showed that the number of 14–17 year olds using e-cigarettes daily, weekly, monthly, or less than monthly is increasing. National Health Survey data indicate that just under one in 12 (7.6%) of Australians aged 15 to 17 years reported using an e-cigarette or vaping device at least once in 2020–21.

e-cigarette companies targeting of children

The use of e-cigarettes by increasing numbers of children is perhaps not surprising, given that e-cigarette liquids are available in a variety of flavours that appeal to children, and that e-cigarette packaging is frequently ‘child-friendly’. According to Elizabeth Greenhalgh and Michelle Scollo the design of some e‑cigarette products to maximise discreet use has also been identified as appealing to young people who may wish to hide their e-cigarette use from parents and teachers. Young peoples’ interest in and adoption of new technologies may similarly contribute to their use of the devices.

In light of this evidence, a number of public health experts have called for stricter regulations on the marketing, advertising and sale of the products. Similarly, the Strategy has argued that ‘normalisation of e-cigarette marketing and use is undermining population health and has the potential to disrupt the significant achievements Australia has made in tobacco control to date’ (p. 7).

Children’s access to e-cigarettes

There are no restrictions on the importation of e‑cigarettes that do not contain nicotine. They may be sold by retailers in all states and territories except Western Australia but may not be sold to minors. In some states and territories, they may be sold only by licensed retailers.

Despite the ban on the sale of e-cigarettes to minors, there is ample evidence to suggest that young people can obtain the products.

According to 2019 NDSHS data a vast majority of minors (14–17-year-olds) who use e-cigarettes obtain them from friends or family members (66.3%), followed by Australian retailers on the internet (13.9%), overseas retailers on the internet (6.0%), and tobacco retail outlets (4.3%). The findings of a study conducted in New South Wales with a representative sample of teenagers 14–17 years old were broadly similar, and the authors observed that teenagers appeared to be ‘readily accessing and using illegal, flavoured, disposable vaping products that contain nicotine’.

Government response to increased e-cigarette use

In November 2022, the Minister for Health and Aged Care Mark Butler announced a public consultation process on the regulation of nicotine vaping products to be run from 30 November 2022 to 16 January 2023 by the Therapeutic Goods Administration (TGA). The public consultation process was instigated largely in response to evidence of an increase in e-cigarette use by children.

Mr Butler also signalled the Government’s intention to cooperate with the states and territories to tighten the regulatory framework that applies to vaping products—both those that contain nicotine and those that do not.

Following the TGA consultation process, Mr Butler announced that the Government would be proposing stronger regulation and enforcement of all e-cigarettes, ‘including new controls on their importation, contents and packaging’. The Government is to work with the states and territories to:

  • stop the import of non-prescription e-cigarettes
  • increase the minimum quality standards for e-cigarettes including by restricting flavours, colours, and other ingredients
  • require pharmaceutical-like packaging
  • reduce allowed nicotine concentrations and volumes and
  • ban all single use, disposable e-cigarettes.

The Government also intends to ‘work with states and territories to close down the sale of vapes in retail settings, ending vape sales in convenience stores and other retail settings, while also making it easier to get a prescription for legitimate therapeutic use’.

Stakeholder comment

Several health organisations and experts have welcomed the Government’s proposed tobacco and vaping control reforms. For example, the Royal Australian College of General Practitioners, the Australian Medical Association and the Cancer Council have expressed support for all of the proposed vaping measures, arguing that e-cigarettes should only be used as a second-line, prescription only, smoking cessation strategy. The AMA also embraced the budget measures, including the tobacco excise increase.

Leading tobacco control researcher Becky Freeman has similarly welcomed the Government’s renewed focus on tobacco control and crackdown on e-cigarettes, insisting that ‘the ideal public health solution would see the elimination of all vaping product sales, nicotine-containing and non-nicotine alike, that fall outside of the TGA prescription pathway’. However, Freeman has cautioned that if the Strategy is to fully achieve its goals, it will need to be fully funded.


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