The
country’s Bureau of Statistics says household consumption of tobacco
fell 4.9 percent during the year that ended in March and clipped a small
but still noteworthy 0.1 percentage point from Australia’s gross
domestic product in the first quarter of this year. Consumption of
cigarettes and tobacco dropped 7.6 percent in the first quarter,
Commonwealth Bank economists said in a research note.
Although
the data, released last week, does not show the rate of change, it
illustrates that total consumption fell, according to the statistics
bureau, which warned that the figures could be subject to seasonal
revisions.
“We
are seeing a very encouraging trend,” said Mike Daube, professor of
health policy at Curtin University in Perth, Western Australia. “The
numbers are heading in the right direction.”
Stephen
Koukoulas, managing director of the Canberra-based Market Economics,
agreed that tobacco consumption seemed to have dropped in the 15 months
since the packaging law, the world’s most restrictive, went into effect.
“Plain
packaging is one of many measures, including high taxes and laws that
restrict where you can smoke, that are having an impact,” he said. “The
national accounts data is the first sign since plain packaging was
introduced that consumption has fallen away.”
But
British American Tobacco Australia said that industry sales volumes
were up, and that the decline in the rate at which smokers start had
slowed.
“A
year after plain packaging was introduced, industry volumes had
actually grown for the first time in over a decade,” a company
spokesman, Scott McIntyre, said in a news release. Tobacco industry data
shows the decline in the number of people smoking “has slowed by more
than half to 1.4 percent” since plain packaging was introduced, he said
in a telephone interview.
British
American Tobacco Australia has about 45 percent of the Australian
market of 3.5 million smokers, with brands like Winfield, Benson &
Hedges and Rothmans. Mr. McIntyre said the sales data was prepared by a
third party and could not be released.
Manufacturers
fought Australia’s Tobacco Plain Packaging Act 2011 in the country’s
High Court and lost in 2012, before the fight moved to the World Trade
Organization. A W.T.O. panel will investigate complaints made by
Ukraine, Honduras, the Dominican Republic, Cuba and Indonesia, who argue
that Australia’s laws breach world trade agreements, including
trademark rights.
Jonathan
Liberman, a lawyer and the director of the McCabe Center for Law and
Cancer in Melbourne, said the proceedings at the W.T.O. “have so far
moved very slowly.”
“It
is in the interests of those opposed to plain packaging to draw these
things out,” he said. “Australia’s move was globally significant, and a
W.T.O. decision in Australia’s favor would be devastating for the
tobacco industry.”
It
seems likely other countries will follow Australia’s lead. In Britain,
an independent review by a prominent doctor, Cyril Chantler, found
“standardized packaging would serve to reduce the rate of children
taking up smoking.” He said in his April report on plain packaging to
the British government that it was “implausible that it would increase
the consumption of tobacco.”
Ireland’s
health minister, James Reilly, said on Tuesday that the government had
approved a draft bill on plain packaging, and in New Zealand, a bill has
been presented to Parliament, where the associate health minister,
Tariana Turia, said plain packaging “takes away the last means of
promoting tobacco as a desirable product.”
Australia’s
legislation is so proscriptive that starting in December 2012,
manufacturers had to sell cigarettes in plain “drab dark brown” packs,
devoid of logos but heavy with health warnings and grisly photos of
cancer patients.
Kylie
Lindorff of the nonprofit Cancer Council of Victoria said packaging
could feature photos of limbs with gangrene, eyeballs affected by
cancer, or a skeletal man dying of lung cancer, accompanied by
large-font statements like “smoking causes lung cancer” or “cancer
causes peripheral vascular disease.” The aim was to limit tobacco
companies’ global reach and the appeal of brands like Marlboro and Camel
to young adults. The Labor government in power at the time further put
into effect extra taxes on smokers, already among the highest in the
world.
“Price
signals really work,” said Michael Workman, a Commonwealth Bank senior
economist. “Sin taxes work, especially if the government has a bigger
motive about escalating health costs.”
In
August 2013, the Labor government imposed a 12.5 percent increase in
the excise rate on tobacco, to be applied each year for four years,
starting in December 2013, with subsequent increases starting this
September. The measures are backed by the current Conservative
government, led by Prime Minister Tony Abbott.
The
Australian Taxation Office says that for every cigarette sold in
Australia, about 40 Australian cents, or $0.38, is collected in excise, a
tax that has almost doubled in a little over a decade. A packet of 25
cigarettes, bought at a supermarket or a convenience store, can range in
price from 13 to 25 Australian dollars.
Mr.
Workman said the fall in tobacco consumption went against a trend in
the national economic data, which showed rising demand for clothing, up
5.2 percent; food, up 2.2 percent; and alcohol, up 1.7 percent, over the
first quarter of 2014.