Increasing Cigarette Sales Despite Plain Packaging In Australia

Chelsea July 18, 2014 0

It was reported by The Australian that ever since the introduction of plain packaging in Australia, there have been increasing cigarette sales in the country. This is said to be due to the fact that budget brands are no longer identifiable as cheaper products due to their common packaging.

An overall 59 million increase in individual cigarettes throughout the country has been shown as total sales during the first full year of the plain packaging’s implementation. This is just one of the several incidences that cigarette consumption is increasing in the modern Westernized country. The o.3% increase reverses that 15.6% downward trend achieved in the past years.

Plain Packaging in Australia

This was introduced back in December 2012 and was hailed as the toughest anti-smoking laws in the world. The plan has seemingly backfired as seen from the increasing cigarette sales from the cheaper cigarette brands. This suggested that smokers simply switched brands and they have smoked more because their new brands were cheaper.

Increasing Cigarette Sales

Infoview monitors the industry and has performed a research wherein it was shown that the market share of these cheaper cigarettes grew to 37% from 32% over the year.

Philip Morris that owns Marlboro cigarette brand said that it has not seen any drop in demand ever since the plain packaging law has been enforced. According to British American Tobacco Australia, the number of smokers who were quitting has dropped while sales volumes were growing.

According to Jeff Rogut, chief executive of Australasian Association of Convenience Stores, sales by the association members increased 5.4% or $120 million in 2013.

He added that talking to his members, one of the very common refrains from people entering the stores is on which cigarettes are the cheapest. He likewise claimed that the move to cheaper cigarettes make people coming back for more.

In 2017-2018, the projected tax take is $10.98 billion compared to only $7.85 billion this year. This suggests that the federal government knows that its laws are not likely to have the expected effect in reducing smoking.

Concerns Over Plain Packaging

Australia still continued with this plain packaging law despite warnings from several groups that it will have unintended public health consequences and that it has no or little benefits.

In 2011, concerns were stated that this law will force the manufacturers to compete in pricing instead of brand. The unintended consequence would be the reduction in cigarette pricing.

Released figures involve only the taxed and legally sold cigarettes, but sales increase could be much higher if the sold counterfeit and illicit cigarettes are taken in.

Plain cigarette packaging makes it a lot easier for counterfeiters to produce their fake cigarettes that are very low in quality and a lot more dangerous that those made by reputable cigarette manufacturers.

Earlier this 2014, the Herald Sun reported that the Australian customs has seized 80 million fake cigarettes. Thus, campaigners said that it might be safer if the packaging were more difficult to copy.

Other countries like the UK have been considering the same plain packaging measure although concerns on the health risks were expressed. The Queen’s speech did not include this plan although Health Minister Jane Ellison stated that the plan will be pushed through.

UK is already flooded with counterfeit cigarettes due to the tobacco taxes there that are a lot higher than in continental Europe. Gullible customers buy the supposed bootlegged cigarettes from France in nightclubs and bars. In truth, however, these cigarettes more dangerous as they came unregulated from China.

Illicit cigarettes are said to be manufactured without any standards followed. Some cigarettes were reported to contain unpleasant ingredients such as rodent dropping and other debris.

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