'Health policy 101': Morrison defends cigarette price hike

Federal treasurer Scott Morrison says the government’s decision to increase the tobacco excise is ‘health policy 101’ and will discourage people from smoking.

Australian Treasurer Scott Morrison speaks at the despatch box during the delivery of the 2016-17 Federal Budget. Source: AAP

The federal treasurer says increases to the cost of cigarettes will help to discourage people from smoking.

In the budget, handed down on Tuesday, it was announced that the tobacco excise will again go up through four annual increases of 12.5 per cent per year, from 2017 until 2020.

The increases will take place on 1 September each year, and could see cigarettes cost as much as $40 by 2020.

The government will also halve the amount of cigarettes available at Duty Free stores from 50 to 25, beginning July 1.

In an interview with SBS chief political correspondent Catherine McGrath after the budget announcement, Mr Morrison said a move to discourage smoking was "health policy 101".

"We'll continue that policy," he said.

Mr Morrison characterised the budget as "a national economic plan for jobs and growth", and rejected Labor’s characterisation that it was unfair.

"They’re deluding themselves," he said, pointing to increased tax support for small and medium-sized businesses announced in the budget.

The treasurer also said multicultural youth, who have high rates of unemployment, would benefit from the budget.

"One of key things you’ve got to do is get these young people into jobs and get them connected, and you can do that through this in a myriad of ways," he said. "And there’s some very innovative people working in this area.

"What I announced tonight will actually support much of what they’re doing."