Susan McDonald (Queensland, National Party, Shadow Minister for Resources) Share this | Hansard source

The Excise Tariff Amendment (Tobacco) Bill 2024 and the Customs Tariff Amendment (Tobacco) Bill 2024 increase the excise and customs duties for all tobacco products by five per cent per year for three years starting from 1 September 2023. The five per cent increase is in addition to the current biannual indexation based on the average weekly ordinary time earnings. The amendments to the Excise Tariff Act incorporate the excise tariff proposal that applied an additional five per cent increase per year from 1 September 2023 to 1 September 2025 to tobacco excise duty rates and aligned the per-stick and per-kilogram excise duty rates. The amendments to the Customs Tariff Act incorporate the customs tariff proposal that applied an additional five per cent increase per year on and from 1 September 2023 until 1 September 2025 to tobacco customs duties rates and aligned per-stick and per-kilogram customs duty rates.

Increasing duties on tobacco also increases the end cost of tobacco products. While these price increases typically reduce overall rates of smoking, they can also push customers to seek out black- or grey-market substitutes at lower prices. This increasingly punishes small businesses who do the right thing and don't sell illegal products.

I commit the bills to the Senate.