Australia to increase tobacco tax by 60 pct over four years

August 1, 2013 Leave a comment

Australia to increase tobacco tax by 60 pct over four years

Thursday, August 1, 2013 – 12:54

Reuters

SYDNEY – The Australian government said on Thursday it will increase tobacco taxes by 60 per cent over the next four years as it seeks to return the budget to a surplus in 2016/17, dealing another blow to cigarette manufacturers. The move, which the government said is also aimed at battling high rates of smoking-related cancer, follows the introduction in Australia last year of the world’s toughest cigarette plain packaging laws.The first of four 12.5 per cent increases will take effect on Dec. 1, raising the average cost of a pack of 20 cigarettes by A$2.20 (S$2.50) to A$19.70. Further increases will kick in on Sept. 1 of the following three years.

Treasury said the increases will raise A$5.3 billion over the next four budget years.

The government has been struggling to return the budget to surplus, delaying promises to do so in the face of a stubbornly high currency and lower commodities prices.

The government also played up the health benefits of the policy, noting that smoking kills more than 15,000 Australians every year. There are around 3 million Australian smokers, the Australian Bureau of Statistics estimates.

“We all know that far too many people in Australia die from cancer,” Treasurer Chris Bowen told reporters. “This I know won’t be universally popular, but it is taken in the best interests of the nation.”

The government has claimed success in curbing smoking from the introduction of the world’s toughest laws on plain packaging late last year, a measure that other countries, including New Zealand and Ireland, plan to follow.

But cigarette makers, including British & American Tobacco PLC, say they have seen little impact on sales from the laws.

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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