Pat Conaghan (Cowper, National Party, Shadow Assistant Minister for Social Services) Share this | Hansard source

I move:

That this House:

(1) notes:

(a) the growing illicit tobacco industry is costing the country $4.2 billion in revenue each year this government fails to strengthen penalties and enforcement measures; and

(b) that the continued failure to seriously address the illicit tobacco trade:

(i) has enabled organised crime groups to fund serious criminal activity including large scale drug importation and human trafficking;

(ii) has seen an increase in violence and attacks on lawful retail tobacco businesses;

(iii) has had a detrimental effect to the health of individuals and community safety;

(iv) heavily impacts on public revenue to the amount of $4.2 billion annually; and

(v) continues to severely impact the ordinary trade of lawful retail tobacconists;

(2) recognises the leadership of the previous Government on enforcement on the illicit tobacco trade by:

(a) establishing the Illicit Tobacco Taskforce in 2018, a multi-agency taskforce to protect Australian revenue and detect and disrupt organised crime syndicates that deal in illicit tobacco; and

(b) introducing amendments to the Public Health (Tobacco and Other Products) Bill 2023 for the establishment of a new Illicit Tobacco and E-cigarette Commissioner with the Australian Border Force;

(3) commends the valuable work of law enforcement and other agencies to detect and respond to the escalating illicit tobacco trade and related crime; and

(4) calls on the Government to:

(a) increase the penalties for illicit tobacco offences;

(b) work with states and territories to implement compatible licencing systems for tobacco sales to assist in enforcement, detection, and disruption efforts; and

(c) ensure that multi-jurisdictional responses can be adequately funded.

I rise today to draw attention to the rapidly expanding illicit tobacco trade within Australia. I think most of the public would not be aware of its far-reaching impacts. The illicit tobacco trade within Australia is a multibillion-dollar—that's with a 'b'—illegal industry. In my view, and in the view of many others, we need to do much more to address this very serious issue. We have various agencies—Commonwealth and state—that have committed significant resources over the years to try and deal with the issue, with varying degrees of specific success but very little discernible impact on market supply.

But I would like to recognise those agencies, both federal and state law enforcement agencies, and, having done the work in the past—and my colleague from Wide Bay, who's next to me, has as well—I appreciate the difficulties that law enforcement agencies face. Despite the establishment of the Illicit Tobacco Taskforce by the coalition back in 2018, efforts have been compromised by the inability to disrupt the supply chain. It's extremely difficult, and unfortunately, when people think of illicit tobacco, they don't put it in the same terms as, say, cocaine or ice. It therefore doesn't get the attention that is needed to address this multibillion-dollar illicit industry.

Unlike other illicit substances, this particular criminal commodity can actually be measured against the government purse. In 2022, a report estimated that 23.5 per cent of all tobacco consumption in Australia—almost a quarter of all tobacco consumption—was illicit, resulting in a staggering $4.2 billion tax loss to the Commonwealth. In addition to the lost government revenue, we've seen direct negative impacts on legal tobacco retailers in general stores. I've spoken to numerous owners of legal tobacco shops. They are losing hundreds of thousands of dollars a month because of this illegal tobacco industry. These are people who pay tax and who employ people in our communities—legitimately and legally.

At the same time, whilst these legitimate industries have lost over $300 million in retail over the last two years, the fact that we're not seeing seizures on the border is contributing to this illicit tobacco industry. In the first six months of 2023, tobacco sales declined an additional 10 per cent. I'd love to say that's because people are giving up smoking, but the fact is that the 10 per cent relates to illicit tobacco.

Another very serious consequence of the illicit tobacco industry is organised crime syndicates using the illicit tobacco industry to fund more serious crimes, such as cocaine, ice and human trafficking. What we've seen, over the past 18 months to two years, is an increase in turf wars and serious crime, including firebombing, particularly in Melbourne and Brisbane, to protect their turf.

I call on the government to increase the penalties for tobacco offences, to work with the states and territories to implement compatible licensing systems and to ensure that multijurisdictional responses can be adequately funded because, without the simultaneous implementation of those three measures, we're not going to make a dent in this illegal industry.

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