Julian Hill (Bruce, Australian Labor Party, Assistant Minister for Citizenship, Customs and Multicultural Affairs) Share this | Link to this | Hansard source

():  I move:

That this bill be now read a second time.

The Combatting Illicit Tobacco Bill 2026 will increase the consequences for criminal actors involved in the illicit tobacco market and enhance law enforcement's powers to investigate. These reforms are part of broader efforts by the Australian government, and states and territories, to strengthen the fight against illicit tobacco.

Illicit tobacco poses significant risks to Australia's public health and community safety. 'Cheap smokes' are everywhere with a now ridiculously ubiquitous retail distribution network. You'd have to have your eyes glued shut not to recognise that this is a problem, and anyone who says otherwise is either deluded or lying.

The latest official estimates in the ITEC commissioner's 2024-25 annual report are sobering:

What used to be seen as a health and revenue issue has now morphed into a serious and organised crime problem.

A massive global surplus of cheap supply of tobacco has been weaponised by transnational serious organised crime groups across the Middle East, South-East Asia and the Pacific, operating like multinational businesses, investing capital in what they perceive as a 'high profit and low risk' situation.

This equation needs to be reversed to make illegal tobacco less profitable and more risky for the criminals involved.

This bill is a critical step to strengthen Commonwealth laws and increase penalties to make the consequences much greater for criminals, target unexplained wealth, and activate enhanced law enforcement techniques, like wiretaps and other powerful tools to track and disrupt criminal networks.

This fight really matters. Smoking still kills on average 66 Australians every day and accounts for 20 per cent of the nation's cancer disease burden. Two out of every three long-term smokers will die of a tobacco related illness.

If our society does not turn the tide on this illicit market then we risk a new generation of Australians getting hooked on tobacco—a costly public health disaster for all Australians, as billions of dollars would then get diverted in the health system to deal with the consequences.

Australians are rightly sick to death of the sleazy, illegal shopfronts that now litter every high street in every city and every town. Brazen criminals must not be allowed to operate in plain sight, and the government is working with and supporting the states and territories to shut down the illegal shops and disrupt the trade.

Let me turn to the specifics of this bill which will amend the Customs Act 1901, the Excise Act 1901, the Proceeds of Crime Act 2002, the Taxation Administration Act 1953, and the Telecommunications (Interception and Access) Act 1979 toensure that the penalties reflect the severity of harm caused by the illicit tobacco trade on the Australian community and provide an even stronger deterrent from engaging in unlawful dealings that threaten our communities and public health. Law enforcement will gain consistent and expanded powers to target proceeds of crime, unexplained wealth and tainted property.

There are two overarching elements of these reforms.

Changing the risk calculation for criminal actors

First, rebalancing of the risk-to-reward calculation for criminal actors involved in the illicit tobacco market by increasing the consequences. This will be achieved through amendments to the Customs Act, the Excise Act, the Taxation Administration Act and the Telecommunications (Interception and Access) Act. These amendments increase the penalties for offences relating to the importation, possession, buying, selling, supply, production or manufacture of illicit tobacco.

Increasing penalties will also enable more effective investigatory powers to be used on a broader range of illicit tobacco offences, including computer access and surveillance capabilities under the Surveillance Devices Act 2004.

Additional amendments will also enable telecommunications interception powers to be used by listing tobacco offences as serious offences under section 5D of the Telecommunications (Interception and Access) Act. This will enable law enforcement and intelligence agencies to seek telecommunications interception warrants for investigation of these offences.

Targeting illicit profits

Second, the reforms will ensure Australia's proceeds of crime regime provides law enforcement with more techniques to prevent offenders from benefiting from the criminal profits generated from illicit tobacco, empowering law enforcement to hit criminals where it hurts. Prosecutions remain import, but they can be slow and expensive. What really hurts the criminals is taking their houses, their cars, their cash, their boats and their toys.

The bill will clarify, streamline and strengthen existing information-gathering and confiscation mechanisms, to increase the effectiveness of law enforcement outcomes.

The reforms will enable information obtained through Proceeds of Crime Act investigations to be shared with other Commonwealth regulators, ensuring that our regulatory bodies can identify, and take action against, professional facilitators that continue to assist criminal actors. This recognises the important role of our regulatory bodies and acknowledges the need for a coordinated, whole-of-government response to combat illicit tobacco markets.

The work that AUSTRAC and the banks are doing to shut down the money flows that keep illicit tobacco profitable is critical to disrupt the trade. Hundreds of high-risk bank accounts have already been reviewed and closed down along with the merchant services and private ATMs withdrawn, alongside a sharp increase in suspicious transaction reporting and strengthened controls. The provision of Proceeds of Crime Act investigation information to bodies like AUSTRAC, ASIC and APRA for a regulatory purpose will see further results.

Similarly, law enforcement will benefit from the modernisation of the existing Proceeds of Crime Act search warrant framework. When the Proceeds of Crime Act was enacted in 2002, its search warrant framework mirrored the Crimes Act at that point. However, since then, the Crimes Act has evolved, leading to inefficiencies and inconsistent powers for the Federal Police.

This bill will recalibrate and realign our legislation, ensuring law enforcement has the same powers and can focus on their job—to seize the proceeds of crime.

Amendments will also be made to the Proceeds of Crime Act to enable law enforcement to effectively target unexplained wealth. These amendments recognise the importance of cross-border cooperation and will ensure that national efforts to confiscate proceeds of crime see equitable sharing across all states and territories. These amendments will strengthen our law enforcement partnerships, and the national response to combat illicit tobacco.

The nature of organised crime and sophistication of cross-border networks is increasingly challenging. Reforms will be introduced to ensure that law enforcement can serve documents under the Proceeds of Crime Act across Australia in a consistent manner, instead of having to satisfy, as they currently do, the individual requirements and differing requirements of each state and territory. Further, additional grounds for a making a non-publication order will be enacted into the Proceeds of Crime Act.

These amendments will ensure national consistency when protecting information related to restraining orders, enabling law enforcement to target criminal networks across Australia while protecting the integrity of each individual proceeding.

Conclusion

This bill comes at a critical time in Australia's fight to contain and reverse the growth of the illicit tobacco market.

Every seizure, every prosecution, every licence suspension and every dollar seized from a criminal under proceeds of crime powers adds friction and puts the illicit market under further pressure.

Increasing penalties and strengthening Commonwealth laws are critical to ensure Australia can continue to deter, disrupt and prevent the further growth of the illicit tobacco market, which will support the health and wellbeing of the Australian community.

I commend the bill to the chamber.

Debate adjourned.