Smokers hit by price hikes to roll-your-own tobacco and cigars in Federal Budget

ROLL-your-own tobacco and cigars will cost more under a government move to align their taxation with manufactured cigarettes.

SMOKERS using roll-your-own (RYO) tobacco and cigars are set to be hit by higher costs.

The government is adjusting the costs of RYO tobacco so that it falls in line with the tax treatment manufactured cigarettes already receive.

The changes for RYO tobacco will hit the per kilogram excise and excise-equivalent customs duty rates, pushing up the cost of each roll.

AT A GLANCE: Your five-minute guide to Budget 2017

YOUNG AND OLD: This is what it means for you

The change was due to the cost of RYO tobacco being regarded as cheaper for smokers but with the new changes the tax on tobacco will be similar regardless of the way the tobacco comes.

The average cost of a 50g pack of RYO loose-leaf tobacco is about $62.

The hike will be phased in from this year through until 2020 to coincide with the already implemented 12.5 per cent tobacco annual tax increases which the Turnbull Government announced last year over a four-year period beginning this year.

These hikes will take effect on September 1 each year.

The new measure is tipped to generate an additional $360 million over four years which will include a $35 million component paid to the states and territories.