How illegal tobacco is messing up Australian economic data

Switzer12-09

Most Australians have probably noticed the proliferation of tobacconists and “convenience stores” in the last few years. These stores aren’t making much from the limited offerings on public display. ...

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These stores aren’t making much from the limited offerings on public display. ...</p>\n\n<a href=\"https://switzer.com.au/the-experts/john-quiggin/75791/\">Source Link</a>\n\n</div>\n","source":"switzer_stock","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>How illegal tobacco is messing up Australian economic data</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nHow illegal tobacco is messing up Australian economic data\n</h2>\n\n<h4 class=\"meta\">\n\n\n2025-12-09 05:54 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://switzer.com.au/the-experts/john-quiggin/75791/><strong>Switzer</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Most Australians have probably noticed the proliferation of tobacconists and “convenience stores” in the last few years. These stores aren’t making much from the limited offerings on public display. ...</p>\n\n<a href=\"https://switzer.com.au/the-experts/john-quiggin/75791/\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"XAO.AU","symbol_name":"标普/澳交所 普通股指数","start_time":0,"source_url":"https://switzer.com.au/the-experts/john-quiggin/75791/","article_id":"2590510361","we_media_id":null,"thumbnails":["https://switzer.com.au/wp-content/uploads/e-liquids-uk-hVcmxpYg1Gc-unsplash-1.jpg"],"rights":{"source":"switzer_stock","url":"https://switzer.com.au/the-experts/john-quiggin/75791/","rn_cache_url":null,"directOrigin":true},"url":"https://stock-news.laohu8.com/highlight/detail?id=2590510361","pubTimestamp":1765230859,"columns":[],"sourceInfo":{"source_id":"switzer_stock","name":"Switzer"},"weMediaInfo":null,"summary":"The growth of illegal tobacco sales has reached the point where the national accounts produced by the Australian Bureau of Statistics (ABS) have been significantly distorted","collect":0,"end_time":0,"defaultTopTitle":"switzer.com.au","property":[],"viewcount":null,"language":"en","relate_stocks":{"XAO.AU":"标普/澳交所 普通股指数","BK4213":"石油与天然气的勘探与生产","GDP":"古德里奇","XKO.AU":"标普/澳交所 300指数","XJO.AU":"标普/澳交所 200指数"},"translate_title":"非法烟草如何扰乱澳大利亚经济数据","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"XJO.AU":1.5,"XAO.AU":1.5,"GDP":1,"XKO.AU":1.5},"content_text":"Most Australians have probably noticed the proliferation of tobacconists and “convenience stores” in the last few years. These stores aren’t making much from the limited offerings on public display. Rather, their profitability comes from under-the-counter sales of untaxed tobacco and illegal vapes.\nThe growth of illegal tobacco sales has reached the point where the national accounts produced by the Australian Bureau of Statistics (ABS) have been significantly distorted. The ABS has announced it is taking steps to measure the consumption of illicit nicotine-related products to supplement existing measurement.\nThe extent of illicit consumption, and the associated loss of revenue is, by its nature, hard to measure. The Australian Taxation Office estimated a net loss of over A$3 billion in 2023-24, but this amount has almost certainly risen since then.\nWhere the - illegal - profits are\nBefore looking at how this decision will affect the national accounts, it’s worth asking how we got here. The short answer is that, over the past decade or so, the tobacco excise has been steadily increased to the point where there are big profits to be made from dodging the tax.\nBut that’s not the whole story. Taxes on spirits have also been raised substantially. At the current rate of $106/litre of alcohol plus GST, tax makes up around two-thirds of the price of a typical bottle of spirits, similar to the case with tobacco.\nYet we haven’t seen a return of the “sly grog” shops that were common in Australia until the 1960s, when the 6pm closing of pubs was abolished. And despite heavy taxes on gambling, illegal casinos seem to be a thing of the past.\nWhat explains this difference? The sale of alcohol and gambling services is subject to licensing restrictions, managed by state authorities and enforced by police.\nBy contrast, until very recently, nicotine products have been treated as normal grocery items. Enforcement was limited until state governments started tightening up the law with changes that have just come into effect.\nThe states have begun shutting down tobacconists found to be breaching it, and even threatened jail for landlords.\nThe Australian Taxation Office, along with the Australian Border Force, makes serious efforts to prevent illegal importation of tobacco products, as well as seizing tobacco crops grown here. But it appears unable or unwilling to do much against retailers who sell cigarettes under the counter.\nState police forces have been slow to enforce the law.\nTheir reluctance here contrasts with the reasonably effective licensing enforcement of alcohol and with the stringent measures taken against suspected users of drugs like ecstasy.\nBut the imbalance between the incentive to dodge the tax and the risks of being caught remains. Until it is resolved, the federal government would do well to defer planned further increases in taxation.\nA question that remains open is whether the growth of illegal tobacco has led to an increase in smoking. Evidence here is mixed. A government survey in 2022-23 showed a continued decline in smoking, alongside an increase in vaping.\nHowever, a more recent Roy Morgan survey suggests an increase of smoking among young people as a result of the vaping ban.\nHow to account for the shadow economy\nNow, back to the ABS. The objective in producing national accounts statistics such as gross domestic product (GDP) is to measure economic activity, giving a guide as to whether the economy is operating at full capacity. That’s important for the Reserve Bank in setting interest rates, but it isn’t a measure of wellbeing.\nAs critics have often pointed out, GDP pays no attention to whether the production being measured is socially desirable, neutral or harmful. Similarly, the ABS has always been aware that not all economic activity is legally recorded.\nThe solution, in the past, has been to add a 1.5% adjustment to GDP to take account of unrecorded (shadow economy) activity. There hasn’t been a perceived need for anything more detailed.\nBut with illicit tobacco estimated to be about 25% of sales in 2023-24 and higher now, this adjustment is no longer sufficient.\nBoth major supermarkets have said their tobacco sales have halved just in the past 12 months, the sharpest fall on record.\nThe ABS estimates growth in final household consumption expenditure has been underestimated by more than 0.5 percentage points over the past year, which is a big deal given the typical annual increase in consumption spending is around 5%.\nKeeping pace with a changing economy\nFinally, it’s worth noting this isn’t the only issue the ABS is looking at in response to an ever-changing economy.\nAs more and more households meet their electricity needs through rooftop solar, the ABS has faced a conceptual issue. This might be thought of as household production, like growing your own vegetables or cooking your own meals, which isn’t counted in GDP.\nBut the ABS has decided it’s better to regard solar rooftops as a home-based small business, whether the electricity is self-consumed or fed back into the grid.\nAs distinctions between home and work, and between licit and illicit production become increasingly blurred, statisticians will need to make more and more judgements like this.\nJohn Quiggin, Professor, School of Economics, The University of Queensland\nThis article is republished from The Conversation under a Creative Commons license. Read the original article.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0,"need_auth":false,"code":"91000000","status":"200"},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.35.12","shortVersion":"4.35.12","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2590510361","isCrawlerRequest":true}