This article is more than 10 years old

This article is more than 10 years old

Tobacco companies would be forced to use plain, logo-free packaging on their cigarettes in a bid to make them less attractive to smokers under legislation introduced today by Australia's government, which dubbed the move a world-first.

The rules, which would take effect on 1 July 2012, would ban tobacco companies from including logos, promotional text or colourful images on cigarette packages. A government health warning would be prominently displayed instead, with the brand name relegated to a tiny, generic font at the bottom.

"The new branding for cigarettes will be the most hardline regime in the world and cigarette companies will hate it," the prime minister, Kevin Rudd, said.

The government also announced it would raise the cigarette tax by 25%, driving up the price of a pack of 30 cigarettes by about A$2.16 (£1.30).

Tobacco firms immediately vowed to fight the reform in court.

"Introducing plain packaging just takes away the ability of a consumer to identify our brand from another brand and that's of value to us," an Imperial Tobacco Australia spokeswoman, Cathie Keogh, told ABC radio, adding that the company planned to take legal action.

Retailers said the tax hike would hurt their businesses and bolster the cigarette black market.

"It's a lazy policy response being pushed by some health advocates," said Mick Daly, the national chairman of the Australian supermarket chain IGA. "That amounts to a direct attack on approximately 16% of Australians who have made legal and legitimate lifestyle choices."

Tim Wilson, director of intellectual property and free trade at Australia's Institute of Public Affairs, said tobacco companies were likely to demand compensation over the forced packaging changes, which could cost taxpayers around A$3bn a year.

"Under Australia's constitution, if the government basically takes someone's property rights, including intellectual property such as trademarks, or devalues them to a significant extent, they have to provide compensation," Wilson said. "I'd be shocked if they didn't [pursue compensation], because if it happens here, it'll happen all over the world."