Australia’s Plain Packaging Has Opposite Effect

Despite government efforts to eliminate tobacco use, cigarette sales have increased.

June 09, 2014

SYDNEY – The Australian reports that 18 months after the plain packaging laws took effect in December 2012, new data shows that tobacco sales volumes increased by 59 million sticks and have boosted demand for cheaper cigarettes, with reports of a more than 50% increase for lower cost cigarettes.

“The 0.3 percent increase, though modest, goes against a 15.6 per slide in tobacco sales over the previous four years — and undermines claims by then health minister Nicola Roxon that Australia would introduce the “world’s toughest anti-smoking laws,” writes the newspaper.

InfoView research shows an increase in the market share for cheaper cigarettes from 32% to 37% in 2013, which is supported by retailers, consumer marketers and the industry, with cigarette maker Philip Morris saying its data has showed no drop in demand.

Jeff Rogut of the Australasian Association of Convenience Stores told the newspaper that sales in convenience stores grew by $120 million (5.4%) last year. “Talking to members, one of the most common refrains they get from people coming into stores is, ‘What are your cheapest smokes?’” he said, adding that with the move to lower-priced products, “people are coming back more often.”

British American Tobacco Australia spokesman Scott McIntyre told the newspaper that despite plain packaging, industry sales volumes had increased and the number of people quitting had dropped. “From 2008 to 2012 smoking incidence, or the number of people smoking, was declining at an average rate of 3.3% a year,” he said, adding, “Since plain packaging was introduced, that decline rate slowed to 1.4%.”

Sydney convenience store employee Harry Nguyen supported industry assertions: “Because the government has made cigarettes so expensive, people just go for the cheapest ones,” he commented. 

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