National

Albanese leaves door open to cutting tobacco excise

By Lucinda Garbutt-Young

Sep 9, 2026

The tobacco levy has drawn conflicting views from Anthony Albanese, Pauline Hanson and Angus Taylor. -AAP Image

The prime minister is leaving the door open to cutting Australia's tobacco excise, as his government faces increasing pressure to curb the sale of illegal cigarettes.

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Just last week, the government slammed the coalition's pledge to slice the excise by 80 per cent, saying the parties were beholden to Big Tobacco and the policies would lead to increased smoking rates.

On Wednesday, Anthony Albanese was asked in an interview on Nine's Today program whether he was guaranteeing there would be no cuts to the excise under a Labor government.

''No, what I'm guaranteeing is we'll take on the criminals. That's what we're doing … We're not about to wave the white flag.''

Labor has increased the excise by 34 per cent since coming to government in 2022, which political opponents say has contributed to a burgeoning black market and a wave of firebombings on tobacco and vape sellers in the major cities.

Making legal vapes and smokes more affordable through cutting the excise and making legal products "isn't going to help", Mr Albanese said.

"State governments as well have a responsibility to crack down on shops that are selling illegal products," he said.

His comments come as One Nation's deputy leader Barnaby Joyce said any alternative to the reducing the excise would let crime thrive.

Mr Joyce, whose party has pledged a 75 per cent cut to the excise, accused the government of allowing money to reach the "'mafia" through low prices from illegal products that legitimate sellers could not compete with.

"What you've done is you've created a market for the mafia, and if you think you can beat it, there's a little story about this guy called Al Capone. Go have a read of it," he told media on Wednesday.

"Both of them (legal and illegal cigarettes) are going to kill you, ladies and gentlemen, but at least one gives you the option to know what is actually killing you."

The coalition has so far not modelled how its proposed cut would affect smoking rates, with Liberal Senator Jonno Duniam using historical evidence from Canada to defend the strategy.

That country raised tobacco taxes through the 1980s, before slashing them in 1994 following a rise in crime. It led to a short spike in smoking before the rates ultimately fell, Senator Duniam told ABC's Insiders on Sunday.