Black market tobacco is a threat we cannot dismiss
THE discovery of a $12 million crop of illegal tobacco in bushland south of Canberra has law enforcement worried. And so it should. Anyone who knows anything about black markets knows that where there’s smoke, there’s generally a raging bushfire not far away. KPMG’s Illicit Tobacco in Australia 2016 report showed that we are now losing $1.61 billion in taxes through illegal tobacco.
On top of the $1.18 billion the taxpayer spends on the futile war on other illicit drugs, we are now spending an equally futile $7.7 million on trying to police illegal tobacco. It’s a waste of time and money.
But not everyone agrees. Quit Victoria and Cancer Council Victoria drew up a report on the use of illegal tobacco in 2011 which they say supports the notion that only 2-3 per cent of the tobacco smoked in Australia is black market. British American Tobacco commissioned Deloitte to do a survey in 2011 and they came up with a figure of 15.9 per cent. In May this year, a KPMG report put the figure at 13.9 per cent.
The Cancer Council disputed Deloitte’s figure and no doubt would do the same for KPMG.
It also claims the National Drug Strategy Household Survey “shows definitively that the vast majority of smokers who have ever used illicit tobacco no longer use it and — of those who do still use it — most used it only occasionally”.
So why would tobacco users who have been paying about $15 for 100g of illegal tobacco suddenly ditch it and start paying the recommended retail price of about $55 for 50g of the legal product?
Are they saying the chop chop dealers just packed up their bags and went home?
Or are they saying that the people buying illegal smokes decided they had better start paying the taxes and levies on legal smokes? It doesn’t make sense. The price rises on tobacco and the amount of public education on
smoking have caused many people to stop — no doubt about that.
Smoking commercial tobacco, laden with chemicals, preservatives, flavour enhancers and other substances to keep you coming back, is about the worst thing you can do for your health.
But when it comes to the health of society, things are more complicated.
Despite what the Cancer Council says, increasing government regulation on tobacco will send potentially millions of smokers into the black market.
There’s reason to question the Cancer Council’s views because they live in an academic world divorced from the realities of the market. Coles is probably its biggest sponsor, having raised more than $10 million through the Daffodil Day appeal.
But Coles is also arguably the nation’s biggest retailer of legal tobacco. Many people see a huge conflict of interest.
And with the price of tobacco so high, many retailers and distributors are suffering record thefts and assaults as criminals realise stealing tobacco is easier than selling drugs. They don’t even go for the till anymore. With 100 packets of cigarettes worth $2500, why would you waste time stealing cash?
With the federal government set to impose another four tobacco tax increases in the near future, the price will be out of reach of many addicts. The government and the Cancer Council think that is a good thing and no doubt another half a per cent of smokers might quit.
But for the other 12 per cent of Australians who still smoke, there could be an exodus to the black market. From there, it is possible a black market in tobacco could join up with the sellers of illicit drugs to form a super black market worth billions. If only a small portion of that goes to terrorist organisations, or to strengthening already existing crime gangs, we’re in trouble.
Governments and their health agencies need to allow tobacco addicts to buy their products at high but affordable prices. They need to get tobacco out of Coles and Woolworths and into agerestricted premises away from children.
And we need to come up with ever more creative educational campaigns about the dangers of smoking. FIONA PATTEN IS LEADER OF THE REASON PARTY