Coalition reveals plan to tax and regulate vaping in Australia if elected

Vape legalisation advocates say the Coalition could raise $510 million a year in tax revenue under its plan to regulate the sale of nicotine products through retailers like supermarkets or convenience stores.

Vape legalisation advocates say the Coalition could raise $510 million a year in tax revenue under its plan to regulate the sale of nicotine products through retailers like supermarkets or convenience stores.

Opposition health spokeswoman Anne Ruston on Tuesday announced a future Coalition government would legalise the sale of nicotine vapes through licensed retailers to any Australian aged over 18, arguing Labor’s plan to limit sales to only pharmacies would not sufficiently stamp out the black market.

But health experts have warned the approach has not resulted in a huge tax intake overseas and Australia should not “lie down and give up” tackling the “catastrophe”.

Supporters of the “tax and regulate” approach say the revenue from GST, retail and wholesale company taxes plus a five per cent import tariff would generate $510m for the federal budget, based on analysis by UK consultancy Independent Economics.

The Coalition has not revealed how much it would tax vaping products, and Ms Ruston would not say if the excise would be the same as the rate applied to cigarettes.

Federal Health and Aged Care Minister Mark Butler holds a press conference on Australia's world leading vaping laws at Parliament House in Canberra. Picture: NewsWire

“What we would be seeking to do is to apply a rate of excise onto vapes, sufficient that we didn’t force people to the black market because of the increased expense, but at the same time to generate the kind of revenue that we need to make sure that we have the funds for enforcement,” she said.

The Coalition plan includes plain packaging rules but would not ban flavoured vapes, though Ms Ruston said she would seek to outlaw flavours that were “predatory against children”.

The opposition also committed $250m for enforcement of vaping restrictions.

A tobacco shop on William St, Paddington. Picture: Justin Lloyd

After making a deal with the Greens, Labor watered down its prescription-only model meaning from July 1 this year, approved tobacco, menthol and mint flavoured vapes will be able to be sold through willing pharmacies to any adult.

About 1.7 million Australian adults currently vape, while the nation also has a high rate of underage use.

Australian Tobacco Harm Reduction Association founding chair Dr Colin Mendohlsen said he believed the Coalition’s approach would ensure adults could easily access vapes and quit smoking.

“The pharmacy model is likely to result in restricted availability, and e-cigarettes should be at least as accessible as cigarettes, which are 20 times more harmful,” he said.

Dr Mendohlsen said he supported making flavours like berry or vanilla available so there was “incentive” for smokers to switch, though examples like “fairy floss” should be banned.

Australian Medical Association president Professor Steve Robson said the explosion in vaping rates among young people was an “evolving public health catastrophe” and it was too early to give up on a prescription-only model.

“Every Australian knows looking around at just what a catastrophe vaping is in young Australians, and we have a very short window to do something about it at the moment,” he said.

Health Minister Mark Butler said he was “not willing to raise the white flag” on a product that had been “deliberately targeted at recruiting young kids to nicotine addiction”.

Mr Butler said the suggestion a tax-and-regulate approach would reduce vaping rates or raise a significant amount of revenue “flies in the face” experiences overseas.

“New York, a jurisdiction about the size of Australia, tried this five years ago,” he said.

“And in the five years since, all we’ve seen is vaping rates climb.”

Originally published as Coalition reveals plan to tax and regulate vaping in Australia if elected