Excise designed to speed quit campaign

SECRETIVE tobacco tax changes will form part of the next wave of the federal government's anti-smoking campaign.

SECRETIVE tobacco tax changes will form part of the next wave of the federal government's anti-smoking campaign as health policy experts aim to speed up the rate at which Australians are quitting.

After doing battle with cigarette companies over plain packaging, the government is refusing to say how much tax it is currently raising from the excise on cigarettes, or how much more it hopes to raise by changing the tax's methodology and timing.

Treasury officials blame an Australian Taxation Office ruling with privacy implications for the companies concerned -- even though the changes are less significant than health lobby groups would have hoped.

The last significant increase in tobacco excise was in 2010, when it was hiked up by 25 per cent, and the latest National Tobacco Strategy has the affordability of cigarettes as its third priority, behind defending existing laws against "Big Tobacco" and stronger mass-media campaigns.

To make cigarettes less affordable, and therefore less attractive to smokers, the strategy -- agreed to by commonwealth, state and territory governments -- recommends "regular staged increases in tobacco excises as appropriate".

Wayne Swan used his budget speech last night to promise to make tobacco indexation "more consistent with consumers' purchasing power" by shifting from a Consumer Price Index model to an Average Weekly Ordinary Time Earnings model.

On current long-term averages, that would involve a higher percentage increase.

For the first time, neither the current nor forecast tobacco excise take has been published in the budget -- the government apparently wants to amend legislation to allow that tax take to be published again in future -- but the broader excise category it would be listed in has taken a $690 million hit since the mid-year update.

From a smoker's point of view, the budget measure is expected to increase the cost of a pack of 25 cigarettes by 7c early next year.

The timing of indexation will also change, delaying the next price hike slightly.

The government has set a target of lowering the smoking rate to 10 per cent by 2018.

Health Minister Tanya Plibersek conceded last night it was a "modest" tax increase, but was welcomed nonetheless. "The figures show that for every 10 per cent increase in price, there is a 4 per cent drop in smoking rates," she said.