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Tobacco giant shrinking size of some cigarette packs as smokers to be hit with another tax rise

A TOBACCO giant is shrinking the size of some cigarette packs as smokers are set to be hit with another tax rise.

Retailers will start phasing in Dunhill brand packs of 23, culled from 25, from next month. The wholesale price of the new packs will be the same as the bigger size now.

British American Tobacco Australia spokesman Nicholas Booth said: “Dunhill smokers told us that instead of paying a higher price after the next tax hike in September, they’d prefer to have slightly fewer sticks and have the price stay the same.

“The wholesale price will be the same as the pre-tax Dunhill 25.”

A double whammy 12.5 per cent federal tobacco excise increase, plus indexation, takes effect from September 1.

The current tobacco tax take on a single cigarette is AUD 53.7 cents — a grab ranging from AUD $10.75 for a pack of 20, to AUD $26.85 for a pack of 50.

Next month’s increase is expected to see smokers cough up at least AUD $1.30 to AUD $3.35 more tax per pack, depending on size.

Retail price changes vary depending on competition and margins.

Public health campaigners say a series of 12.5 per cent annual tax hikes pencilled in for the next four years will further reduce smoking rates because of soaring prices.

The Dunhill downsize adds to a string of shrinking packs including Freddo Frogs, laundry liquid, deodorants and potato chips such as Pringles.

“British American Tobacco Australia is working with retailers to roll out Dunhill 23s from September,” Mr Booth said.

“The product remains the same with all Dunhill 25s variants transitioning to this pack size by the end of the year.

“Like most fast moving consumer goods companies we have a portfolio of products we offer our consumers and this is constantly reviewed.

“The introduction of Dunhill 23s is in response to feedback from consumers.”

September’s 12.5 per cent tobacco excise increase is in addition to twice-yearly indexation linked to average weekly ordinary-time earnings. The indexation amount for September will be determined soon.

Cigarette makers have warned that steep excise rises are fueling the illegal tobacco black market.

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