David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Hansard source

The government is bleeding smokers dry. Once the government is finished, do you think it will stop? I don't. I think it will then tax the next most vulnerable group of Australians. To those listening, let me say this: it could be you. If you want to stop the ravenous tax man before he bleeds you and your family dry, you have to vote for the Liberal Democrats. The bill before us today will be waived through the parliament by the Liberals, Nationals, Labor, the Greens and crossbenchers, like those in the Xenophon team. It is a mean, sneaky and stupid bill. It increases the tax rate on cigars and loose leaf tobacco from its staggeringly high level of $772 per kilogram to the astronomical level currently applying to cigarettes of $882 per kilogram. That tax is the reason Australia has the most expensive smokes in the world.

The bill is mean because cigarette smokers are disproportionately poor and include thousands of Aborigines, unemployed, disabled and other welfare recipients. The tobacco taxes that smokers pay are already at least 17 times the healthcare costs that smokers impose on other taxpayers. The bill is sneaky because the government could just as easily reduce the higher tax rate to the level of the lower rate. There is even a case for maintaining a lower tax rate on cigars, as their use is typically less addictive and harmful than cigarette use.

The bill is also stupid because increasing tobacco tax rates further will prompt faster growth of the untaxed and unregulated black market, so tobacco tax revenue may actually fall. Only today we have seen Customs officials charged regarding an alleged tobacco-smuggling ring. The media and government won't admit the obvious, which is that this is a direct result of extortionate tobacco tax rates. From every aspect this is appalling legislation. I condemn it totally.