Shocking figure NSW could be making if vapes are legalised
NSW could be making a whopping $836m in extra GST over the next four years if vaping is legalised and treated the same way as cigarettes.
NSW
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NSW will rake in more than $836m in additional GST revenue over the next four years if vapes are legalised and whacked with a $1.50 excise per ml.
Modelling based on $1.50 per ml showed that NSW would make an extra $162.9m in 2024-2025 in GST if vapes were regulated, followed by $196.2m the year after.
In 2026-2027, NSW would get an extra $225.8m and another $251.2m the year after.
The figures are based on the Commonwealth Grants Commission’s most recent GST distribution method.
The findings come amid fierce debate on the best way to tackle the crisis which has gripped a generation, with the Coalition mulling over its final position on vaping after the federal Nationals said they support vapes being regulated, sold in plain packaging and charged an excise.
Environment Minister Tanya Plibersek argued “the only people who want more sales of vapes in Australia are the big tobacco companies.”
“Their first generation of customers is dying from smoking-related ill health,” she told Sunrise on Monday morning.
“They want a new generation of customers. That’s the kids. These vapes are shaped like highlighter pens or computer memory cards so kids can hide them in their pencil cases. “Teachers say this is the worst discipline problem in schools.”
Ms Plibersek said while hundreds of millions in tax revenue could be made if vaping is legalised, the government would consequently spend “billions in the health system cleaning up the mess of vaping addiction”.
“Kids are sleeping with vapes under their pillows so they can wake up in the night and vape. “They’re getting popcorn lungs, black mouth disease.
“No, we shouldn’t be making it easier for kids to get vapes.
“The problem is they’re there. The kids are still going to have them under the pillow.
“We’re stopping them at the pillow. We’re stopping them at the border and we should be stopping people selling them.”
A whopping 85 per cent of people who voted Labor at the 2022 federal election would either agree or strongly agree with vapes being regulated in the same way as tobacco products, according to RedBridge polling of 1500 Australians.
Nationals MP Barnaby Joyce said with the evident market for vapes in Australia, their sale should be legalised and regulated.
“People are making money out of it, the Mafia predominantly. If you want to fix that, you have to bring it in a regulated form,” he said.
“I do not vape, they will kill you but so do cigarettes and they’re legal. It doesn’t have the effect of alcohol or drugs that it destroys your capacity to drive a car, there is not the moral outrage against other drugs.
“That doesn’t make it right but we’ve got to be a realist and say unless you want people to take an unregulated product from China, the money flows back to criminals in China and Australia, you have to be a realist and say wouldn’t it be better to have a regulated product we can strictly control and the revenue goes back to the Australian health system where it belongs?
“The money being made (from vaping) is being made by criminals. When they go to buy their vapes with all the colours in it, as you say, they also meet the person who sells them ice, sells them heroin, who sells them dope, sells them meth, all the other things you don’t want this person ever to meet.”
Support to regulate vapes was also strong across inner and middle suburban Australia, with 82 per cent agreeing or strongly agreeing to vapes being treated as cigarettes, 83 per in outer suburbs and 81 per cent in rural communities.
The polling also showed that 45 per cent of people with a “great deal of financial stress” were still “strongly” in support of vapes being regulated the same way as tobacco products — which included the addition of an excise.
The research also showed that parents of children under the age of 18 were supportive of vapes being regulated, sold in plain packaging and not marketed to teenagers.
More than 80 per cent of mums surveyed said they either strongly agreed or agreed with the proposal while 77 per cent of dads felt the same way.
Australian Association of Convenience Stored chief executive Theo Foukkare said the Albanese government’s position of only allowing those with a prescription to get a vape — and banning disposable vapes — would only push vapers into the criminal market.
“Other countries are actively reducing youth vaping in a similar way to alcohol and tobacco,” he said.
“The government’s priorities are completely out of step with what the community expects and what parents are calling for.”
Economist Saul Eslake said legalising vapes would “undoubtedly” help make up for the tanking tobacco revenue but the government must weigh up the boost in the budget bottom line with health risks.
“The reason revenue from tobacco taxes is declining despite the rate of tobacco going up a lot is because fewer people are smoking and that’s a good thing. In an ideal world tobacco tax wouldn’t raise any revenue because no one would smoke,” he said.
“You shouldn’t look at this solely through a revenue lens. It would seem to me that in addition to the fact that fewer people are smoking, revenue is declining because more people are vaping and there is a lot of criminal activity involved with it.
“You have to decide the costs vs benefits of making vaping a criminal activity.”
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