The Minister Assisting the Health Minister (Cancer), Verity Firth, will take a plan to cabinet in the next fortnight which would see the ban introduced more than four years after it was announced by the previous minister, Frank Sartor.

But cabinet is understood to be split on the proposal, with support from the Treasurer, Michael Costa, and Small Business Minister, Joe Tripodi, questionable.

Representatives from Philip Morris have met Mr Tripodi in an attempt to get his support in cabinet not to proceed with the ban, and have met members of Ms Firth's office on four occasions.

A letter from Philip Morris to retailers obtained by the Herald encourages them to write to the Premier, Mr Tripodi and Ms Firth to get her to drop the proposal.

The letter says: "As a responsible tobacco retailer, you should be aware of and consider the effects such a law would impose on your business and make your views known."

It warns of an "inability to display promotional prices to consumers" and says "new customers may be unable to determine if you have their brand of choice in stock".

Philip Morris is understood to have made it clear to the Government that one of its main concerns is a loss of market share; it is attempting to wrest the No.1 spot from British American Tobacco.

The ban - intended to cut down on youth smoking and on tobacco advertising - was first announced by Mr Sartor in Parliament in February 2004. The Herald revealed in 2006 that it had been dumped without it proceeding to cabinet, after lobbying from retail interests.

Ms Firth as minister has taken up the proposal again, with a plan to ban smoking in cars containing children.

Philip Morris has approached several ministers for meetings. The company claims it is in favour of reducing the size of its displays in shops but opposes a total ban.

Imperial Tobacco is understood to have joined the fight against Ms Firth, launching freedom-of-information requests with NSW Health for correspondence between Ms Firth, the cancer institute and anti-smoking groups in a bid to gain ammunition for the tobacco case.

Mr Tripodi said yesterday: "As Minister for Small Business, we have met with Philip Morris and affected small businesses. The goal of reducing smoking has my full support and my interest is to achieve this with minimal red tape for small businesses."

The Heart Foundation is understood to have sent a letter from its chief executive, Tony Thirlwell, to ministers arguing that of all the recent proposals by the Government to counter smoking, the decision concerning removing cigarette packets from display is the most important.

The chief executive of the anti-smoking group ASH, Anne Jones, said she was concerned that cabinet was about to "overturn recommendations to protect children in favour of protecting tobacco pushers".