The Tobacco Control Antis Have a Problem

One Nation has proposed a 75 per cent reduction in tobacco excise, and you could almost write the responses before they arrived: public health progress is threatened, Big Tobacco will benefit, smoking could increase, we need stronger enforcement, tougher penalties and more quitting support, and above all we must protect decades of tobacco control achievement. Welcome back to the Australian tobacco debate, or, as I increasingly think of it, the Antis versus reality.

I use “the tobacco control antis” not to describe every researcher, doctor or public health advocate working in this field, because there are thoughtful people on all sides of this debate. I mean something more specific: a mindset. The Antis are the guardians of tobacco control orthodoxy, fiercely protective of the policies they helped build, deeply suspicious of anything that challenges the traditional model, remarkably comfortable prescribing ever greater restrictions, and seemingly incapable of contemplating the possibility that a policy which worked extremely well in the past might eventually produce diminishing returns or serious unintended consequences.

For decades, the formula was beautifully simple: tax cigarettes, restrict cigarettes, denormalise smoking, make smoking less convenient, make cigarettes less affordable, and repeat. Much of it worked, but Australia in 2026 isn’t Australia in 1996. Something has changed. The black market has arrived, and it didn’t arrive quietly.

Pauline Hanson’s One Nation is reportedly proposing a 75 per cent reduction in tobacco excise, together with a three-year pause on indexation, an extraordinary proposal that could reportedly reduce a legal packet currently costing around $46.50 to roughly $21 to $22. The argument is that legal cigarettes are now being asked to compete with illicit packets commonly selling for dramatically less, so One Nation’s solution is simple: shrink the price difference and drag consumers back into the regulated market.

Is 75 per cent the right number? I don’t know, and I would like to see the modelling. I would like to see 25, 50 and 75 per cent reductions compared and their likely effects on smoking prevalence, illicit market share, government revenue and organised crime examined. But here is what I find fascinating: some of the people demanding rigorous evidence for changing the policy seem remarkably uninterested in demanding equally rigorous evidence that continuing the existing policy will solve the problem. Apparently only one side has to prove its case.

The reaction from the tobacco control establishment has been entirely predictable. ACOSH CEO Laura Hunter has argued that cheaper tobacco isn’t the answer and has called instead for stronger enforcement, tougher penalties and coordinated action against the illegal market; Cancer Council and other public health organisations have warned against weakening Australia’s tobacco control policies; Health Minister Mark Butler has rejected the idea that there is some magical excise “sweet spot” that would suddenly defeat the illicit market; and the Greens’ Larissa Waters has attacked One Nation’s proposal as benefiting tobacco company profits. Different voices, remarkably similar answers: don’t touch the tax.

And this is where I think Australia’s tobacco control establishment has a credibility problem, because if you are going to tell Australians that the solution is more enforcement, eventually somebody is entitled to ask: how much more? How many raids, seizures, shop closures and arrests? How many millions of dollars and how many years? How many tobacco shop firebombings does Australia need before we’re permitted to question whether something more fundamental has gone wrong?

Apparently the one policy setting that must never enter the interrogation room is tobacco excise itself. Everything else can be blamed: criminals, retailers, consumers, tobacco companies, social media, border enforcement, state governments and federal enforcement, but never the economic incentive created by the policy. That remains untouchable.

For decades the Antis taught us something important: price changes behaviour. Raise the price of cigarettes and people respond, and that proposition helped justify repeated excise increases. Fair enough, but now there is another cigarette available for $15 or $20 while the legal packet may cost dramatically more, and suddenly the economics becomes strangely selective. We’re expected to believe price strongly influences whether somebody smokes yet apparently has little relevance to where that smoker purchases cigarettes.

That makes no sense. If consumers respond to price when governments increase it, they don’t magically stop responding to price when an illegal supplier undercuts the legal market. You cannot build decades of tobacco policy around price elasticity and then become coy about price elasticity when it produces behaviour you don’t like, yet that is effectively where Australia has arrived.

The next defence will inevitably be that Australia’s smoking rate is at historically low levels, and that is good news which deserves acknowledgement, but a national prevalence number cannot answer every policy question. It does not tell us what proportion of the cigarettes still being consumed were purchased legally, whether existing smokers have moved from expensive legal cigarettes to cheap illicit cigarettes, whether the illicit market is becoming more entrenched, or whether current excise settings remain optimal. Smoking prevalence and illicit market penetration are different measures and both matter. If smoking falls while an increasing share of the remaining market moves underground, governments need to understand both developments rather than using one to pretend the other doesn’t exist.

Then comes the Antis’ favourite answer: stronger enforcement. There is something wonderfully reassuring about those words because they sound decisive and allow governments to announce taskforces, seizures, raids, new penalties and additional funding. Enforcement absolutely has a role. Organised crime should be disrupted, illegal retailers should face consequences and borders should be protected, but enforcement has a fundamental limitation: it attacks supply while leaving the economics of demand largely intact.

Imagine an illicit packet sells for $15 and the legal equivalent costs $50. That difference isn’t merely a pricing curiosity; it is the business model. Every time authorities remove one supplier, the enormous potential margin creates an incentive for somebody else to replace them. The Antis appear to believe this can eventually be enforced away, and perhaps they’re right, but after everything Australia has experienced surely they’re now required to demonstrate that proposition rather than simply asserting it. Where is the endpoint? At what level of enforcement does the illicit market become economically unviable, what will it cost, how long will it take, and what happens while we wait? These aren’t pro tobacco questions. They’re basic public policy questions.

And then there are the vapes, which is where the entire Australian model becomes almost surreal. If the objective is reducing the enormous harm caused by smoking, you might imagine that Australia would make substantially lower risk alternatives readily available to adult smokers while regulating them appropriately. Instead, we created the pharmacy model, while cigarettes, the product responsible for the overwhelming majority of tobacco related disease, remain legally available through ordinary retail and illegal cigarettes and disposable vapes have become widely available through the same illicit networks the government is desperately trying to suppress.

Think about the absurdity: an adult smoker can walk into an ordinary retailer and buy cigarettes, but accessing a regulated nicotine vape requires navigating a far more restrictive legal system, while that same adult can simply visit an illicit retailer and buy whichever product they want. Cigarettes, vapes, take your pick. The criminal market has become Australia’s nicotine convenience store. That isn’t harm reduction. It is regulatory inversion.

There is also a glaring omission from much of the Antis’ response: tobacco harm reduction. If the real objective is to reduce smoking related disease and death, then the debate cannot remain trapped between expensive legal cigarettes and cheap illegal cigarettes. There is a third pathway, helping adults who would otherwise smoke move to substantially less harmful, non combustible nicotine alternatives.

Vaping, nicotine pouches, snus and heated tobacco products are not risk free, nor do they need to be risk free to have a legitimate role in harm reduction. The relevant comparison for an adult smoker is with continuing to inhale cigarette smoke. A rational nicotine policy would recognise those differences in risk and make regulated safer alternatives more accessible, affordable and attractive to adults than combustible cigarettes. Instead, Australia has restricted some alternatives so heavily that the illicit market has stepped in to supply them, while the cigarette remains readily available through ordinary retail. If the Antis genuinely want fewer people smoking, they should be asking not only how to make cigarettes less attractive, but what we want smokers to move to instead. An endgame without an accessible off ramp isn’t much of an endgame.

Suppose One Nation’s 75 per cent reduction is wrong. Fine. Then I have a very simple question for the Antis: what is your number? Not your slogan, not “strong enforcement”, not “protect tobacco control progress”, and not another lecture about Big Tobacco. What is the optimal tobacco excise? At what price does the deterrent effect against smoking begin to be outweighed by substitution towards illicit cigarettes? How large can the legal and illegal price differential become before policymakers should intervene? What level of illicit market penetration would trigger reconsideration? Twenty per cent, 30 per cent, 50 per cent? Is there any level at which they would reconsider the tax?

Because if the answer is no, then this is no longer evidence based policymaking. It is doctrine. A genuinely evidence based position must contain some conceivable evidence capable of changing it, otherwise we aren’t testing a policy, we’re defending a belief.

I am not convinced that cutting tobacco excise by 75 per cent is necessarily the right answer, but One Nation has done something useful by forcing Australia to discuss something tobacco control would much rather keep outside the Overton window: what if tobacco excise has become too high?

That question should not be scandalous. Every policy has trade offs, every intervention has limits, every tax has behavioural effects and every regulation can produce unintended consequences, so the mature response is to measure them. Instead, questioning excise often produces an almost theological reaction. How dare you? Taxes reduce smoking. Case closed.

Except the case isn’t closed. The market changed, consumers adapted, organised crime adapted, technology changed and alternative nicotine products appeared. The institution that sometimes seems most determined not to adapt is tobacco control itself.

Perhaps that is the deeper problem exposed by One Nation’s announcement, because Australia does not actually have to choose between the Antis’ endless escalation and One Nation’s dramatic tax reduction. There is another possibility: redesign nicotine regulation around risk.

Keep strong disincentives against combustible cigarettes while making regulated smoke free alternatives significantly cheaper and easier for adults to obtain; license legitimate retailers while aggressively enforcing age restrictions; apply taxation proportionate to product risk; give smokers accurate information about relative risk; and attack organised crime while simultaneously reducing the extraordinary profit incentive that keeps attracting criminals into the market. Most importantly, make the safer legal option the easier option.

Instead, Australia has managed to create almost the reverse. The most dangerous nicotine product remains readily available legally, lower risk alternatives face extraordinary restrictions, illegal suppliers offer both, and when the predictable black market emerges, the people who designed the system tell us the solution is to enforce it harder.

At some point, policy evaluation has to become more than defending yesterday’s decisions. The Antis are entitled to oppose One Nation’s proposal, warn that cheaper cigarettes could increase consumption and scrutinise tobacco industry involvement, but they are no longer entitled to pretend that the status quo carries no costs of its own.

The fires are real, the illegal shops are real, the seizures are real, the criminal profits are real, the consumers buying illicit cigarettes are real, and the enormous price differential between legal and illegal tobacco is real. One Nation’s 75 per cent figure may ultimately prove right, wrong or somewhere in between, but at least it has put the question on the table.

The Antis’ problem is that they appear to have only one answer to every problem: more of the policies that helped create the problem.

Perhaps the most important question raised by One Nation isn’t whether tobacco excise should be cut by 75 per cent. It is whether Australia’s tobacco control establishment is still capable of changing its mind.