Tobacco companies will be frozen out if Labor is re-elected, with Kevin Rudd pledging to completely end their involvement in the political process, and to phase out any investment in cigarette firms by public sector super funds.
The move is designed to end big tobacco's influence and to wedge Opposition Leader Tony Abbott, whose party has not ruled out accepting donations from cigarette makers.
The ALP stopped taking tobacco industry support in 2004 but the Coalition continues to accept donations.
Mr Rudd told Fairfax Media that a re-elected Labor government would ''amend the Commonwealth Electoral Act 1918 to ban donations from tobacco companies to Australian political parties and candidates''.
Arguing that tobacco is the only legal product which ''kills when used exactly as intended by the manufacturer'', Mr Rudd believes he is on a moral and political winner, citing an annual Australian death toll from tobacco of 15,000 Australians.
The government says the cost to the Australian economy of tobacco-related illnesses exceeds $31 billion a year.
''Tobacco companies themselves have admitted they only donate to political parties to try to influence policy,'' Mr Rudd said.
''By British American Tobacco's own admission, they only donate to the Liberal Party to influence Liberal Party policy.''
Mr Rudd also plans to order the divestment of a swag of public sector superannuation funds - identified by the anti-smoking group ASH, Action on Smoking and Health - as having holdings in tobacco companies.
That follows a 2013 decision by the Future Fund to exclude all tobacco companies from its portfolio of interests.
ASH chief executive Anne Jones said it was clear that tobacco interests wanted something for the millions they handed over. ''That's really what their goal is, you can open doors with that,'' she said.
Ms Jones said it was disappointing that in this digital age it was still impossible to find out out before an election how much tobacco money had been donated and to whom.
All Australian governments have signed up to the national tobacco strategy which has a goal of getting smoking under 10 per cent by 2018. Ms Jones said that would not be achievable without the excise hike and other measures. Labor's plain packaging reforms were opposed by the Coalition.
The announcement, to be made on Thursday, follows on closely from a steep 60 per cent increase in federal tobacco excise over four years announced in the pre-election mini-budget. The $5.3 billion to be raised has since been accepted by the Coalition.
The new reforms would be supported by the Greens in the Senate, virtually guaranteeing their success.
Mr Rudd accused the Liberal Party of accepting ''more than $3 million from big tobacco since 1999''. Australian Electoral Commission returns put the figure closer to $2.6 million - compared with Labor's estimated receipt of $630,000 to 2004.
Mr Abbott told the Today Show on April 30, 2010: ''Look, it is legal to smoke. It's not the mafia, it's not even the CFMEU. I don't see why, if they want to make a donation, we shouldn't accept it.
''But look, I'm not out there touting for business, and in the end it's up to the lay party to make these decisions.''
With Lisa Visentin