My smoke free life — 7 Comments

  1. I hate to disappoint you – but you’ve already paid a lot of taxes in order to now receive the pension?


  2. Politicians are the same the world over. Earlier this year the Australian Treasurer Scott Morrison announced that with the changes to tobacco tax the government expects to raise $5.1 billion over the next four years. Then he went on to say:-

    “These changes will improve the health of Australians by reducing their exposure to tobacco products….” which I assume means smokers will quit smoking. But if smokers quit there goes the $5.1 billion.

    I get my government pension, I go straight to the tobacconist and get my fortnights ration of one 50g pack of Borkum Riff Black Cavendish which costs me $66, about $40 of which is tax and one pack of Rothmans cigarettes which cost $18 of which about $14 is tax. They give with one hand and take it back with the other. And they wonder why the tobacco black market is growing.


    • It’s this pretence that they are “helping” me to quit that really pisses me off.  If I want help I will fucking ask for it.

  3. A first year economics class in University should be enough to tell you that taxes on products such as alcohol and tobacco are largely due to their inelastic nature… Heck, even a HIGH SCHOOL economics class tells you that.

    What is “inelastic nature,” well, it’s what I’m calling a relatively inelastic demand. That means demand changes less than the price change, so a $1 increase in a cigarette package leads to say a 0.5 reduction in packets sold, for example. This is due to the lack of “close substitutes.”
    Some goods are perfectly inelastic – say a “miracle drug” related to some disease, or illicit drugs like amphetamines. This means people are willing to pay whatever the price is, and their level of demand never changes.

    For example, butter and margarine are used as examples of goods which have a relatively elastic demand curve. If the price of one increases, demand tends to decrease at a higher level than the price. That assumes everyone who eats butter will eat margarine, and vice-versa.
    Naturally some goods are perfectly elastic, which means any increase in the price will result in the demand falling to zero – this would be a market where “perfect competition” exists.

    The point of all this, taxing alcomahol, tuhbakkah or anything along those lines under the muse of “public health” is utter rubbish. They tax these things because it looks good, and because taxing relatively inelastic goods is actually quite efficient, as demonstrated above.

    But I digress, everyone here knew that already. Ha.

    • The problem for the gubmint though is the rise in elecrofags and the proliferation of smuggled cigarettes.  By providing an alternative, they have introduced a level of elasticity into the market where there are now two viable alternatives to paying tax.  The gubmint isn’t going to allow a couple of billion slip through its greasy fingers.  I hope they get a massive headache trying to sort that one.

  4. Ferris Buellers Day Off is fucking brilliant grandad! I would watch it if I were you just for the 80’s nostalgia. 🙂

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