Scott Morrison revealed the 2017 Budget last night, and there were no real surprises. Cuts to tertiary education? Check. Restrictions on welfare payments? Check. A vague attempt to help young people afford houses without annoying baby boomer voters? Check. All were widely reported by the ABC, the Guardian, and NewsCorp. However, hidden deep within the Budget lies a sneaky little addition that has slipped past the mainstream media: the price of roll your own tobacco is about to go up.
Flick to page 12 of Budget Paper No. 2, and some senior Canberra public servant has outlined it all very clearly. "The Government will adjust the taxation of roll your own (RYO) tobacco and other products such as cigars, so that manufactured cigarettes and RYO tobacco cigarettes receive comparable tax treatment," the document reads.
Currently, RYOs (thanks for the new acronym, ScoMo) are more economical than cigarettes, which are taxed at a higher rate. But come September, they'll be subject to the same series of tax hikes that are set to hit cigarettes. Over the next four years, there will be be annual rises of 12.5 percent. Over this time period, roll your own tobacco is expected to make the government $360 million, with $35 million of that paid to states and territories via GST.According to a 2003 study, around 22 percent of Australian smokers buy roll-your-own tobacco over cigarettes. And while many a Melbourne art bro prefers rollies to cigarettes for purely aesthetic reasons, the reality is that plenty of smokers have switched to the tobacco pouch because they can't afford not to—as another study outlines, there's a direct correlation between people buying tobacco and factory cigarette taxation increasing. So this policy is a win for the government because it will generate revenue, and probably decrease smoking rates too as people get priced out.It's admittedly hard to feel sorry for that guy who always turns up to the party with a jumbo pack of filters—but next time you see him, bear in mind that he's probably only smoking tobacco in the first place because he's scared of being cut off by Centrelink.Follow Kat on Twitter
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