Andrew Willcox (Dawson, Liberal National Party, Shadow Assistant Minister for Manufacturing and Sovereign Capability) | Hansard source

The real debate today isn't happening inside the comfort of this chamber. It's happening to the sound of midnight sirens, the shattering of storefront glass and the pungent smell of smoke in our suburbs. Follow that smoke and it leads directly to the police tape stretching across local shopping centres, to the charred ruins of family businesses and into the lives of everyday Australians, who no longer feel safe walking down suburban streets. I rise in this chamber today not to debate a piece of public health regulation but to confront a national security crisis.

This multibillion-dollar criminal empire didn't just emerge from an unforeseen global shock. It was built, brick by brick, under the watchful eye of the Albanese government because of a failed tax policy that has created the most lucrative black market this country has ever seen. Labor thought they were taxing a habit. Instead, they subsidised a syndicate. Criminal syndicates don't deal in statistics; they deal in terror.

Let's look at the real victims of this policy. A 27-year-old woman, Kate Tangey from Melbourne, is dead. Her family is shattered. Their lives are completely destroyed. Why did this happen? Because a criminal tobacco gang firebombed the house she was in, targeting the wrong place in the dead of night. She paid the ultimate price for the gang warfare that has continued to run rampant. The syndicates might be targeting their rivals, but everyday Australians are the ones being dragged into the inferno. Look at the Gold Coast, where a late-night attack gutted a neighbouring laundromat and suburban cafe. And look right here in Canberra, where fires have forced families out of their beds as nearby apartment blocks have had to be evacuated. The underworld is fighting for market share, but the public is carrying the terrifying risk.

If anyone in this chamber thinks this black-market warfare is a crisis confined to the big cities, they are wrong. You only have to look at the suburb of Andergrove in Mackay in my electorate of Dawson. Just after midnight on 28 February, the Andergrove Village shopping complex became a war zone. For the fourth time in two months, a local tobacco shop was targeted by arsonists. But the fire didn't stop there. It ripped through the walls and completely gutted Bauer Mackay, a brilliant family-run electrical business next door, destroying over $160,000 worth of their equipment. The hardworking owners, the electrical business—they did absolutely nothing wrong. They didn't deal in tobacco. They didn't deal in contraband. But their livelihood was reduced to ashes anyway because the out-of-touch government has allowed the legal criminal empire to run rampant on our doorstep.

The assailants, caught on CCTV, were two adults in balaclavas wielding flaming Molotov cocktails—a targeted and deliberate attack. This is not a regulatory issue; this is gang warfare playing out next to our schools, next to our cafes and inside our communities. Unbelievably, there have now been more than 285 firebombings across this country linked directly to this illicit trade. The syndicates might be aiming at their rivals, but the collateral damage falls entirely on the innocent. It falls on the family run bakery next door, it falls on the first responders rushing into a burning building at midnight, and it falls on local residents forced to flee their beds.

The coalition will support the passage of this bill because any weapon, no matter how blunt, is better than leaving our police empty-handed. But let's be completely honest. This bill is too little, too late. It is a desperate attempt by a government that has lost control of our borders and lost control of our streets. The profits from this black market are funding bikie gangs, international syndicates and cartels. The government's own figures admit that the illicit market is worth up to $6.9 billion annually. That's nearly $7 billion in cold, hard, untaxed cash flowing straight to the worst elements of society, and that's how they get so rich. Labor serves the business model on a plate.

When the Albanese Labor government handed down its 2023-24 budget, they rammed through massive compounding increases to tobacco excise. They did so ignoring the warnings from law enforcement and retailers. They genuinely believed that, if you keep raising the price of a legal packet of cigarettes, demand will magically vanish. But they forgot the actual first rule of market economics: if you tax a legal product into orbit, you do not stop people smoking; you simply hand the entire market over to organised crime. When a legal packet of cigarettes costs over $40 and a criminal syndicate can sell an illegal imported packet under the counter for $15, you create an absolute gold rush for thugs. You make illicit tobacco more profitable than trafficking cocaine with a fraction of the legal risk.

Labor did not fix smoking; they accidentally became the chief marketing managers for the black market cartels. And what has been the result for the budget? The Parliamentary Budget Office has revealed that these failed tax settings have blown a massive $20 billion hole in the Commonwealth revenue base. At the exact moment local families are staring at electricity bills stuck to their fridges, wondering how they're going to buy groceries, billions of dollars in tax revenue are being diverted from our healthcare, our education and our roads straight into the pockets of underground syndicates. It is a spectacular double failure, a law-and-order catastrophe and a fiscal disaster all rolled into one.

This is not just a coalition critique. The anger and frustration has reached boiling point inside the Labor Party itself. Labor state governments are completely frustrated by the incompetence in Canberra. The New South Wales health minister, Ryan Park, has publicly and repeatedly slammed the Albanese Labor government's failure to act. He has rightly pointed out that the state authorities are being left to play an endless, futile game of whack-a-mole, trying to shut down illicit shops while the federal government's high excise continues to pour high-octane fuel on the fire. New South Wales Labor premier Chris Minns has shown the type of leadership that the Prime Minister lacks. He has called for a total rethink of the excise strategy, acknowledging that current settings are completely unsustainable and actively counterproductive. When their own state colleagues are publicly begging this government to fix a mess, it is definite proof that they have completely lost control of the nation.

The government tells us that this bill will solve everything by increasing maximum penalties, expanding investigative powers and targeting criminal profits, but, when we actually read the text, this bill is all show and no substance. The legislation is obsessed with increased maximum penalties on a piece of paper rather than providing the resources to improve actual enforcement on the street. Anyone who understands the courts knows that doubling a maximum penalty means absolutely nothing if the judiciary system isn't imposing the current limits and if financial penalties are rarely enforced against underground networks. Cartels do not look at a sentencing schedule before they plan a firebombing. They look at the likelihood of getting caught. And, under this administration, that likelihood is remarkably low.

The Australian Border Force made an incredibly blunt submission to the Senate inquiry on this very issue. They noted that we cannot simply seize our way out of this problem. They explained that their frontline officers are running themselves ragged trying to mop up a flood while the Labor government keeps the taps turned on full blast. This bill ignores the tsunami entirely and just gives the Australian Border Force a slightly larger mop.

What is missing from this bill tells us everything you need to know. This legislation does absolutely nothing to address the core structural drivers of the crisis. There is no reconfiguration of the disastrous excise settings. The government refuses to even look at the pricing signals they are sending to the economy. They are so wedded to their policy pride that they would rather see suburban shops boarded up with police tape than admit their tax experiment has backfired. There is no significant new investment for our frontline enforcement agencies, no major funding boost for the Australian Border Force at our container terminals, no new support for domestic compliance operations to help local police raid illicit warehouses and zero explanation of how government intends to solve the practical street-level hurdles facing our communities. We have all seen the ridiculous spectacle of an illegal tobacco shop being shut down by state health officials, only to reopen 48 hours later under a different name with a new frontman. This bill provides no mechanisms to break that cycle.

Even the government itself admits the legislation is a lightweight response. In the explanatory memorandum, they concede that the financial impact of the bill is small. They are introducing a signature bill to solve a multibillion dollar national crisis, and their own official documentation admits they cannot quantify a single dollar of criminal disruption. That tells you everything you need to know about the substance of this plan.

However, the coalition will support the bill, because we believe some tools are better than none, but this government must implement a far more comprehensive strategy to restore the rule of law. A serious response to the crisis must move beyond paper penalties and focus on actual disruption, confiscation and closure. This government should coordinate with the states to introduce immediate nationwide store closures and lease termination provisions. If a business is caught selling illicit tobacco, authorities must have the power to padlock the doors, cut the utilities and cancel the commercial lease immediately. This government must make it physically and financially impossible for these illicit shopfronts to operate.

This government must also shift its focus from penalties to the complete confiscation of revenue streams. Our law enforcement needs tobacco-specific asset forfeiture laws that allow police to seize the cash, the luxury vehicles and the properties of anyone involved in this trade, hitting the syndicates where it hurts the most—their wallets.

Thirdly, the government must finally swallow its pride and look at the pricing signals driving this crisis. There needs to be an honest, independent review into how tobacco excise settings are impacting the black market, guided by law enforcement and economic reality rather than bureaucratic stubbornness.

Lastly, this government must actively support our frontline state and territory enforcement officers. We cannot expect local police forces to bear the brunt of a federal border failure without direct financial and logistical assistance from Canberra. This debate is no longer just about tobacco regulation; it's about community safety, economic sanity and the rule of law.

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