Why Do Cigarette and Tobacco Prices Change in Australia?
Adults may notice that cigarette and rolling-tobacco prices in Australia change over time. These changes are not determined by retailers alone.
Government excise, tax indexation, wholesale costs and delivery expenses can all affect the final price displayed to customers.
What Is Tobacco Excise?
Tobacco excise is a government duty applied to tobacco manufactured in Australia. Equivalent customs duties generally apply to imported tobacco.
The Australian Taxation Office publishes different excise calculations for:
- Cigarettes and other tobacco products measured per stick
- Cigars and cigarettes containing more than the prescribed tobacco weight
- Loose-leaf and roll-your-own tobacco measured by weight
These rates are indexed periodically. When the excise rate rises, the wholesale and retail prices of cigarettes and tobacco may also change.
Other Factors Affecting Tobacco Prices
The final retail price may also be affected by:
- Goods and Services Tax
- Supplier and wholesale costs
- Importation and regulatory expenses
- Transport and storage costs
- Retail operating expenses
Because these costs can change independently, different tobacco products may not increase in price by exactly the same amount or at the same time.
Taxes Must Be Included in Online Prices
Australian online tobacco listings must show one price for each regulated tobacco item. The displayed price must include all applicable taxes.
Online point-of-sale pages must also include the statement:
“Product prices include all taxes.”
Displaying separate regular and sale prices or using terms such as “cheap,” “discount,” “bulk savings” or “tax free” is prohibited in online tobacco advertising.
Does a Lower Price Mean Tobacco Is Illegal?
Price alone does not prove whether cigarettes or tobacco are legal. However, an unusually low price—particularly when combined with missing health warnings, unusual packaging or an unidentified seller—can be a warning sign.
Illicit tobacco is tobacco on which the required duty has not been paid or which has been illegally grown, manufactured or imported.
Customers should not assume a product is lawful based only on its appearance or price.
Checking Current Excise Information
Because tobacco excise rates change, articles quoting a fixed rate can quickly become outdated. The most reliable approach is to check the current rate directly through the Australian Taxation Office.
This article is provided for general information and does not promote tobacco use.