Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697642247736.pdf (Australia)
Department of the Senate PO Box 6100 Parliament House Canberra ACT 2600 tobaccoharmreduction.sen@aph.gov.au Re: Select Committee on Tobacco Harm Reduction The Liberal Democratic Party is an Australian political party that stands for greater freedom, smaller government and personal responsibility.
As a party of libertarians, classical liberals and freedom ﬁghters, we support the right of individuals to make their own choices regarding the use of tobacco products, and have been strong advocates for the legalisation of alternatives to smoking.

We welcome the opportunity to provide the following submission to this Select Committee.
Liberal Democrats Submission - Select Committee on Tobacco Harm Reduction Page 1 of 9 Tobacco Harm ReductionSubmission 266 Summary Smoking Harms Tobacco Parasites Smoking Alternatives Market Solution Why Not Here?

Conclusion 3 3 4 5 7 7 8 Liberal Democrats Submission - Select Committee on Tobacco Harm Reduction Page 2 of 9 Tobacco Harm ReductionSubmission 266 Summary The Liberal Democrats are committed to free markets with minimal government interference.
Although smoking is undoubtedly an activity that poses signiﬁcant health risks, it is the position of this party that individuals should be free to make choices that carry personal risk.

We are deeply concerned that the actions of government health bodies have exacerbated the harms of smoking, and that their interference in the free market has prevented Australian smokers from accessing alternatives to smoking that are signiﬁcantly safer.

This includes vaping, snus, and ‘heated tobacco’ devices.
Most concerning is the strong ﬁnancial incentive that successive governments have created for themselves to maintain smoking rates, whilst steadily increasing the punishing eﬀects of tobacco excise and tobacco regulation.

In this submission, we seek to make the following key points to the committee: 1.

That the Federal Government (in conjunction with State and Local Government) has put in place laws that increase the ﬁnancial and mental harms of smoking 2.
That the Federal Government is acting as both the primary ﬁnancial benefactor of tobacco, as well as the gatekeeper for safer competitors - a clear conﬂict of interest 3.

That multiple safer forms of nicotine are available worldwide, and that the Australian Government has endangered public health by prohibiting them 4.

That vaping is successful internationally because it is a market-led solution, and that attempts to over-regulate it hamper the potential beneﬁts 5.
That the overwhelming body of evidence internationally supports the legalisation of vaping Smoking Harms Any proper tobacco harm reduction strategy must account for the ﬁnancial harm and mental health eﬀects created by the federal tobacco excise escalator and various state Smoke-Free Acts.

Australians now endure the highest cigarette prices in the world 1 as a direct result of the tobacco excise charged by the Federal Government.
This is a regressive tax 2 that directly harms smokers, and disproportionately hurts the poorest in society.
Not only does ﬁxed excise account for a higher percentage of a lower income, but lower socioeconomic status individuals smoke at much higher 1 numbeo.com/cost-of-living/country_price_rankings?displayCurrency=USD&itemId=17 2 journals.lww.com/eurjcancerprev/fulltext/2007/08000/Increasing_the_price_of_tobacco__economically.13.aspx Liberal Democrats Submission - Select Committee on Tobacco Harm Reduction Page 3 of 9 Tobacco Harm ReductionSubmission 266 rates to begin with 3 .
Signiﬁcant ﬁnancial harm caused to struggling people, many of whom became addicted to nicotine when access to tobacco was much cheaper, cannot be under-estimated.

The poorest Australians not only enjoy a lower quality of life, but are twice as likely to die before 75 as the richest Australians 4 .

Various pieces of legislation passed by State and Territory Governments are also harming the mental health of smokers.
Each state has laws restricting or banning smoking in public places and venues used commonly for social gatherings such as pubs, restaurants and sporting arenas 5 .

The primary eﬀect of this is social exclusion for smokers, which is linked to depression, reduced impulse control, obesity and premature death 6 .

The most disturbing aspect of the ﬁnancial and mental health harms caused by the Federal and State Governments is that they are not merely unintended consequences.
Deliberately causing harm to discourage smoking is precisely the aim of the legislation in question.

The reduction in the rate of smoking is stalling 7 despite the continual increase in tobacco excise, creating a substantial risk of these policies doing much more harm to those still smoking than the harm they reduce for those they nudge into quitting.

There are also unintended harms, associated primarily with the beneﬁts enjoyed by gangs and other black market operators.
Black market tobacco sales are booming, accounting for up to 15% of the market in 2014 8 , with experts suggesting it could be even higher now.

This not only empowers gangs, but presents serious health risks to consumers through the sale of unsafe products.

This was recently observed in the United States with vaping-related illnesses occurring as a result of black market products containing Vitamin E acetate 9 .
Tobacco Parasites One cannot discuss the harms of tobacco without addressing the primary ﬁnancial benefactor from cigarette smoking: the Federal Government.

In 2019, the federal government received over 12 billion dollars in customs and excise revenue on tobacco products 10 .
The current excise per cigarette is set 3 www.tobaccoinaustralia.org.au/chapter-1-prevalence/1-7-trends-in-the-prevalence-of-smoking-by-socioec 4 www.australianpopulationstudies.org/index.php/aps/article/view/62 5 www.tobaccoinaustralia.org.au/chapter-15-smokefree-environment/15-7-legislation 6 royalsocietypublishing.org/doi/10.1098/rstb.2014.0114 7 www.athra.org.au/blog/media_releases/smoking-rates-stall-as-australia-loses-the-battle-against-smoking 8 home.kpmg.com/content/dam/kpmg/pdf/2016/04/australia-illict-tobacco-2015.pdf 9 www.cdc.gov/tobacco/basic_information/e-cigarettes/severe-lung-disease.html 10 www.tobaccoinaustralia.org.au/chapter-13-taxation/13-6-revenue-from-tobacco-taxes-in-australia Liberal Democrats Submission - Select Committee on Tobacco Harm Reduction Page 4 of 9 Tobacco Harm ReductionSubmission 266 at an eye-watering $1.103 per stick 11 .
On a $38.95 packet of Winﬁeld 25s, the federal government receives $27.59 in excise - over 70% of the total retail price.

Public Health bodies enjoy painting a picture of the evil big-tobacco executives proﬁting oﬀ the addiction of smokers, but the Federal Government is raking in more than the tobacco companies, the retailers, and the State Governments combined.

The Federal Government micromanages the appearance of cigarette packaging through plain packaging laws.
The Federal Government controls the availability of any competition to tobacco via the Therapeutic Goods Association, which has rejected the sale of less harmful nicotine products such as vaping, snus and heated tobacco devices such as iQOS 12 .

If a private individual attempts to grow their own tobacco, they risk a $42,000 ﬁne 13 .

The Federal Government has created a virtual monopoly on tobacco revenue.

Surely the government is not proﬁting oﬀ the suﬀering and death of smokers?
Surely they are investing every cent back into easing the exorbitant burden of smoking on the strained healthcare system?

One might think so based on reports such as the Curtin University Study Identifying the Social Costs of Tobacco Use to Australia in 2015/16 14 which places the total social cost of smoking at $137 billion in 2016 - but, almost all of the ascribed costs are related to ‘intangible’ cost estimates.

The real cost of smoking on Healthcare was placed at $6.8 billion.
The federal excise for 2016 was $9.8 billion.

In summary, the Federal Government is the primary ﬁnancial benefactor from smoking; it sets the price on an addictive product and receives the lion's share of the proﬁt.

It actively prevents the emergence of safer competitors, and ﬁnes people for growing their own tobacco.
Whether their actions to protect the current cigarette market are through greed or incompetence, it is a clear conﬂict of interest for the government to be acting as both the primary benefactor and the market regulator for nicotine, and one or both of these roles must be immediately abandoned.

Smoking Alternatives The health risks of smoking are well known, but nicotine itself is not the cause of smoking-related disease.
The TGA knows this, having approved nicotine to be widely sold in Australia in the form of chewing gum, patches, aerosols and more.
These are available in multiple ﬂavours and strengths, 11 www.ato.gov.au/Business/Excise-on-tobacco/Excise-obligations-for-tobacco/Excise-duty-rates-for-tobacco 12 www.tga.gov.au/book-page/32-nicotine-heated-tobacco-products 13 www.ato.gov.au/General/The-ﬁght-against-tax-crime/Our-focus/illicit-tobacco 14 https://ndri.curtin.edu.au/NDRI/media/documents/publications/T273.pdf Liberal Democrats Submission - Select Committee on Tobacco Harm Reduction Page 5 of 9 Tobacco Harm ReductionSubmission 266 sold without a prescription at any pharmacy or supermarket.
Other methods of nicotine delivery include snus, heat-not-burn devices, and vaping - all of which are prohibited from sale.

Snus “is not a signiﬁcant risk factor for developing lung cancer, cardiovascular disease, pancreatic cancer or oral cancer” 15 , and its prevalence in Sweden has resulted in dramatically lower rates of both cigarette smoking and tobacco-related morbidity.
Although pouch tobacco may not be seen as an immediate replacement to tobacco by the average Australian smoker due to our cultural diﬀerences to Sweden, it is completely illogical to limit the availability of a safer alternative to tobacco.

It is the position of the Liberal Democrats that the sale of snus should be immediately permitted alongside tobacco, and without the burden of a tobacco excise.
Heat-Not-Burn devices, most notably the IQOS, are a newer entrant to the market, and work by using a heating element to warm tobacco to release nicotine, which is inhaled.
In the United States the Federal Drug Administration has concluded that “scientiﬁc studies have shown that switching completely from conventional cigarettes to the IQOS system signiﬁcantly reduces your body’s exposure to harmful or potentially harmful chemicals.” 16 As referenced in the previous section, this device was prohibited from sale in Australia by the Therapeutic Goods Administration.
This decision did not include any evidence that the device was more harmful than tobacco, or address the likelihood that it is less harmful.

It is the position of the Liberal Democrats that it is wrong for the TGA to block the sale of a potentially less harmful market alternative to tobacco.

Vaping is perhaps the most revolutionary and successful alternative to tobacco in existence.
Vaping simulates the habitual nature of smoking without the health risks (the UK Royal College of Physicians has consistently reported 17 that vaping is at least 95% safer than smoking), and is more eﬀective for smoking cessation than traditional nicotine-replacement therapy 18 .

Despite this, vaping nicotine is legally impossible in Australia due to a web of regulation by federal and state governments.
These restrictions must be immediately lifted if Australia wishes to see the same reductions in smoking rates as the UK and New Zealand.

15 Clarke, E., Thompson, K., Weaver, S. et al.

Snus: a compelling harm reduction alternative to cigarettes.

Harm Reduct J 16, 62 (2019).
https://doi.org/10.1186/s12954-019-0335-1 16 www.fda.gov/news-events/press-announcements/fda-authorizes-marketing-iqos-tobacco-heating-system-reduc ed-exposure-information 17 www.rcplondon.ac.uk/projects/outputs/nicotine-without-smoke-tobacco-harm-reduction 18 www.nejm.org/doi/full/10.1056/NEJMoa1808779 Liberal Democrats Submission - Select Committee on Tobacco Harm Reduction Page 6 of 9 Tobacco Harm ReductionSubmission 266 Market Solution Vaping is rightfully the primary focus of this enquiry, so it is worth addressing the reason it has been so successful in curbing smoking rates in countries fortunate enough to have more liberal governance.
Vaping is a ground-up market solution to the problem of smoking health risks.

Chinese pharmacist Hon Lik is credited as the inventor of the commercial vape device in 2003 19 , a smoker who was driven to create a safer product after the death of his father from lung cancer.

The continuous innovation spurred by this invention has created a thriving market with thousands of diﬀerent devices and possibly millions of diﬀerent ﬂavour combinations.
Whereas previous smoking cessation methods were led by health bodies and pharmaceutical companies, vaping has been driven by innovators, entrepreneurs and small business owners.

The ability for consumers to ﬁnd a suitable device, ﬂavour and nicotine strength is undoubtedly a key factor in this success.

Many devices are unsuitable for ﬁrst-time users, and choosing the most eﬀective ﬂavour and strength of vape juice out of millions of possible combinations is extremely complex.
Vape stores (predominantly small businesses and owner/operators), provide a high quality of advice to the smokers who walk through their doors, largely based on their own smoking cessation journey as well as market knowledge.

The current proposal to make nicotine vape liquids available only by prescription is lunacy.

Pharmacists and doctors do not have the lived experience or market knowledge to replace the expertise of the free market.
It is a measure that will deter many smokers from a life-saving alternative and cost lives.

Why Not Here?

Several other jurisdictions have taken a market-based approach to tobacco harm reduction, allowing other nicotine products to compete with cigarettes.

This method has been more successful at reducing smoking rates than Australia’s heavy reliance on taxation, regulation and prohibition.
Unlike in Australia, there are no restrictions on the sale, use or advertising of e-cigarettes or nicotine liquid to or by adults in the United Kingdom 20 .
Governments have gone as far as to allow owners of pubs, restaurants and other venues to determine their own individual vaping rules, with great 19 www.casaa.org/historical-timeline-of-electronic-cigarettes 20 www.bbc.com/news/uk-25900542 Liberal Democrats Submission - Select Committee on Tobacco Harm Reduction Page 7 of 9 Tobacco Harm ReductionSubmission 266 success.
Since vaping started to gain traction in 2013-14, smoking rates have declined in England at a rate of 0.8% per year, compared to just 0.3% per year in Australia 21 .

This has taken England’s national adult smoking rate from 18.7% to 13.9%, putting Australia’s relatively meagre reduction from 16.5% to 14.7% to shame.

This strategy has been even more successful in New Zealand, where adult smoking rates have steadily dropped from 18% in 2013 to just 12.5% 22 in 2018.
The New Zealand Ministry of Health openly supports vaping as a tobacco harm reduction strategy 23 , and like the United Kingdom allows businesses to set their own individual vaping rules.

The United States tells an even more interesting story.

The increased popularity of vaping saw a sharp and immediate decline in the smoking rate from 17.9% in 2013-14 to 15% just two years later.
In 2016 the United States Food and Drug Administration mandated electronic cigarettes be regulated as tobacco products 24 , resulting in an immediate plateau in the rate of smoking reduction, indicating that over-regulation may dull the harm reduction impact of this product.

Overall, adult smoking rates have still decreased at an average rate of 1% per year since 2013-14 25 , far exceeding that of Australia.

The evidence is clear.


Despite all coming from higher starting points in 2013-14, the three jurisdictions now have lower adult smoking rates than Australia.

In all three cases cigarettes are much cheaper 26 – in the United States, over two thirds cheaper – than in Australia, but are consumed by a smaller percentage of the adult population.

The key diﬀerence between these three jurisdictions and Australia is our antiquated, prohibitory regulatory framework surrounding tobacco alternatives.
Market solutions in pursuit of tobacco harm reduction are clearly more eﬀective than harmful taxes and restrictions.

Conclusion The tobacco harm reduction strategies pursued by all levels of government in Australia have long failed to account for the harms deliberately caused to smokers by targeted regressive taxes, restrictions, and bans.
The Liberal Democrats believe the Federal Government’s parasitic 21 www.athra.org.au/blog/2020/07/16/national-survey-suggests-vaping-is-reducing-smoking-in-australia 22 www.smokefree.org.nz/smoking-its-eﬀects/facts-ﬁgures 23 www.vapingfacts.health.nz/the-facts-of-vaping/vaping-law-and-policy 24 www.fox21news.com/news/new-fda-regulaons-on-electronic-cigarees-could-hurt-local-vape-shops 25 www.athra.org.au/blog/2020/07/16/national-survey-suggests-vaping-is-reducing-smoking-in-australia 26 numbeo.com/cost-of-living/country_price_rankings?displayCurrency=USD&itemId=17 Liberal Democrats Submission - Select Committee on Tobacco Harm Reduction Page 8 of 9 Tobacco Harm ReductionSubmission 266 relationship with tobacco sales has created a perverse incentive to monopolise the industry and continue the pursuit of harmful policies with diminishing returns.
As shown above, the market-based approaches in other jurisdictions have proven much more successful since the rise in popularity of alternatives to tobacco, with even greater success correlating with less regulated environments.

We believe a substantial factor of their success has been their market-based nature as opposed to the mere existence of the alternatives themselves, and that this should be an important consideration.
The Liberal Democrats encourage the committee to recommend a new national tobacco harm reduction strategy based on the success of those pursued in the United Kingdom, United States and New Zealand through the following legislative and regulatory changes: 1.

The immediate reduction of tobacco excise.


Ideally this would be eventually abolished entirely, but even a reduction to a more sensible level such as that in the United States would greatly reduce both the ﬁnancial harm caused to smokers and the conﬂict of interest created for the Federal Government.

International evidence suggests this would not have an adverse eﬀect on smoking rates if the below policy changes were also implemented.

2.
2.

The full legalisation of the use, sale and advertising of safer nicotine products such as snus and nicotine e-liquid, with no excise and without the need for a prescription.

3.

The regulatory decoupling of vaping and smoking.


The case study of the United States clearly showed a much steeper decline in smoking rates before the FDA decision to treat vaping as smoking, while England and New Zealand boast lower smoking rates than Australia and the United States partly due to their decisions to allow privately owned social venues (such as pubs and restaurants) to set their own vaping policies.
Liberal Democrats Submission - Select Committee on Tobacco Harm Reduction Page 9 of 9 Tobacco Harm ReductionSubmission 266