Plain packs, tax hikes not fuelling illicit trade

Public health

29 Nov 2017

Mandatory plain packaging and a rise in tobacco tax have not resulted in a flood of illicit tobacco onto the Sydney market, a trend study shows.

Instead, it appears smokers are switching from premium brands to cheaper value brands, the empty pack survey spanning 17 local government areas across Sydney reveals.

The study involving respiratory physician Professor Matthew Peters from Concord Hospital in Sydney, NSW collected 1604 discarded empty cigarette packs from public areas such as beaches, parks, shopping centres and railways stations across the different sociodemographic areas of Sydney.

 For the next three years the researchers collected a similar number of cigarette packs at each collection site at the same time of year.

After adjusting for pack size, 13.1%, 11.5%, 10.2% and 10.9% of packs collected did not comply with plain packaging requirements in years one, two, three and four respectively.

Across the four surveys premium cigarettes fell from 30.6% to 14.6% with value segment cigarettes increasing from 33.3% to 51.1%.

Speaking to the limbic Professor Peters said there was a consistent argument that mandatory packaging and increases in tobacco tax will result in an increase in illicit trade, thereby negating the policy.  

Professor Peters noted that while there were legally legitimate ways to bring overseas cigarettes into the country, significant changes in the origin of the cigarette packs across the survey collection points suggested that some illicit trade was occurring.

“However we can say that the proportion of non domestic packs collected from the same areas four years in a row has gone down, not up,” he said.

“Tobacco price increases have changed smoker behaviour because we have seen a switch to value brands from premium brands… tobacco companies have reacted to price increases by creating value products,” he added.

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