Peak retail industry body the Australian Retailers Association (ARA) said the Rudd Government’s plans to make plain packaging compulsory for tobacco products by 1 January 2012 would significantly increase the sale of illegal tobacco, putting children at greater risk.

ARA Executive Director Russell Zimmerman said the Government’s announcement seemed rash and premature considering submissions for the Senate Inquiry into Plain Tobacco Packaging close tomorrow with the Committee not due to report until 26 August 2010.

“Plain packaging has no demonstrable public health benefit and will lead to unintended consequences such as an increase use of illegal tobacco – because counterfeiting and smuggling would be made easier.

“Obviously it is easier to counterfeit a product that isn’t branded and already over 12 percent of all tobacco consumed is sold illegally, costing the Federal Government more than $600 million per year in lost taxes*.

“Retailers are vigilant in their responsibility to ensure they are not selling tobacco products to minors, but obviously there is no one checking IDs on the black market,” Zimmerman said.

Zimmerman added the Government’s plans to introduce compulsory plain packaging for tobacco products only duplicated the regulatory burden and costly increases to transaction times caused by retail display bans already scheduled for six states and territories across Australia.

“Scheduled retail display bans already hide display of cigarette packaging, and like retail display bans, plain packaging is likely to significantly increase the time taken to complete a transaction at the register.

“Regulations that increase transaction times have been estimated to cost businesses up to half a billion dollars ($461 million) – equivalent to 15,000 jobs. **

“The cost of plain packaging regulations will be compounded by negative flow-on impacts to upstream sectors such as printing – leading to further job losses.

“For small scale grocery retailers and convenience stores, the sale of products can account for up to 30 to 40 percent of their profits and the ARA is disappointed there has been no consideration of retailers - or other industry groups - prior to the announcement of the Government’s plans to introduce compulsory plain packaging for tobacco products,” Zimmerman said.

Source: http://www.retail.org.au/index.php/news/Retailers_say_plain_packaged_tobacco_puts_children_at_risk

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