One Nation tobacco plan criticised by Labor for engaging in ‘bidding war’ with organised crime

Labor has warned against One Nation’s plan to drastically slash the tobacco excise in a bid to compete with the black market and fight organised crime.

Under Pauline Hanson’s proposed changes – which include a 75 per cent excise cut and a three-year pause on indexation – a $46.50 legal pack would fall to about $21 or $22 to make legal tobacco “competitive” with illegal products.

Pauline Hanson cited evidence tendered to a Senate inquiry that placed the price of illicit packs at $12 to $25 in a statement explaining her policy.

The 75 per cent reduction comes after Senator Hanson committed to a different figure in her National Press Club address in June.

At the time, she said One Nation would cut Australia’s tobacco excise by 50 per cent and freeze indexation for two years.

The One Nation leader claimed “stronger border enforcement, faster shop closures, tougher penalties for traffickers and attack organisers, and aggressive seizure of criminal assets and unexplained wealth” would accompany this change to bolster the party’s crackdown on organised crime.

A 2024-25 report by the Illicit Tobacco and E‑cigarette Commissioner valued the illicit tobacco market in Australia at an estimated $5.6bn.

The report found the amount of evaded excise revenue was between $7.7bn to $11.8bn, compared to $7.7bn excise paid on legal tobacco imports.

However, Health Minister Mark Butler derided Senator Hanson’s plan as a “cheap headline” when asked about One Nation’s plan to compete with illicit tobacco.

Mr Butler told the ABC governments were not “usually in the habit of engaging in price competition with organised crime”.

“That’s a hard line for us to cross. Equally, no one’s really said to me or to the government where the price point is that actually starts to move them out of the market.

“I think this requires more deep thought than frankly cheap headlines of the type we’ve seen this week.

“We’re not particularly interested in thought bubbles in an area that is this important.”

Aged Care Minister Sam Rae issued a similar warning, telling Channel 9: “We don’t want to get into a bidding war on tobacco prices between big tobacco and organised crime”.