Mike Freelander (Macarthur, Australian Labor Party) | Link to this | Hansard source

I rise to support the important Combatting Illicit Tobacco Bill 2026, and it is a very important bill. Illicit tobacco is a significant risk to our nation's public health and community safety—as indeed is smoking and vaping. By passing this legislation, our government will be helping tackle this major scourge on our society.

I've been involved in antitobacco campaigns for many years, particularly in the seventies and eighties. There was the BUGA-UP campaign, which people may have heard of—or maybe not, given that I'm getting older! BUGA-UP was the Billboard Utilising Graffitists Against Unhealthy Promotions campaign. It ran against tobacco advertising in the seventies and eighties, often led by health people. In particular there was a doctor who was a member of the Greens in the upper house of New South Wales, Arthur Chesterfield-Evans, who led that BUGA-UP campaign. And it worked: we did eventually get rid of tobacco advertising. Thanks to Nicola Roxon, the Labor attorney-general, we were able to get rid of tobacco advertising on cigarette packets etc. We went to plain packaging. We've done incredibly well in our antitobacco campaigns, and our smoking rates are amongst the lowest in the world.

But there are dangers. The dangers are, at least partly, the illicit tobacco trend. Tobacco, often as part of organised criminal networks, is coming into the country. It's being sold without the excise payments, so it's very cheap, and that encourages people to smoke. South-west Sydney, my electorate, has a growing illicit tobacco problem that's only getting worse. We have really dodgy businesses with blacked out windows or limited shelf stock pretending to be cafes or pretending to be corner shops dotted all around the region providing cheap and dangerous illicit tobacco to anyone and everyone. I've heard many members in this House note that they're experiencing the same thing in their electorate, including the member for Moore, noting that his Western Australian electorate experiences the same issue. It shows that, from South Western Sydney, across the Nullarbor and into Western Australia, illicit tobacco is a major concern for our country, and such a large issue requires a national response as well as a state response. So our federal government is acting to support the states and territories and strengthen their fight against illicit tobacco with this bill.

Let me make this quite clear: those that are calling for reductions in excise payments are really just requesting that we increase our smoking rates. We need to make sure that the price signal we're giving people with our excise on tobacco is quite clear and discourages people from smoking. Reductions in excise will only increase smoking rates. We need to police our excise system appropriately at both the federal and state level. We need to get rid of organised crime. We need to attack them on their business models. And we need to put resources into this. If it's not tobacco, organised crime will go to something else. It'll go to illicit alcohol or some other illicit product. Organised crime needs to be confronted, not supported, and cuts to excise are not the answer.

I've heard lots of people talking about excise reductions, but it's important to note that our anti-smoking campaigns are working, that we are actually getting reductions in our smoking rates, particularly in high-risk communities, like Indigenous communities. Figures just released by the Australian Institute of Health and Welfare have shown that, most recently. Smoking rates are coming down. Smoking rates are much, much lower than when I was a medical student and a young resident. We were always seeing people with lung cancer or chronic obstructive airways disease presenting to our emergency departments, hospitalised and, in fact, dying. Respiratory wards were always full of people with these illnesses, who were dying from the effects of smoking. We've reduced it hugely. We've dropped our smoking rates from over 30 per cent to now under 12 per cent and 13 per cent in many communities—fantastic effort; we need to keep it up. We do not need to encourage more smoking.

At the moment, major crime organisations from abroad working with criminal groups and exploitative businesses here are reaping huge profits off the poor health and suffering of other Australians. Their cheap, nasty tobacco is being sold to vulnerable people here, with profits being siphoned offshore, whilst we're left to deal with the crime, poor health outcomes and tax avoidance involved in the illicit tobacco trade. Our government is doing as much as it possibly can to reduce this trade. We need to give less income to these criminal groups. We need to bolster public health services and law enforcement as well, to make sure that organised crime and illicit tobacco disappear.

I'd like to speak on these three issues: firstly, the health consequences; secondly, the criminal consequences; and, thirdly, the financial consequences of illicit tobacco. Firstly, the health consequences—for years, we've seen a significant shift away from tobacco consumption, particularly in younger generations. That's really important, because, the earlier you start smoking, the more likely you're going to get major respiratory damage with chronic obstructive airways disease, and the more at risk you will be of lung cancer. We need better awareness programs through education and social awareness.

Unfortunately, the rise of illicit tobacco on our streets means we're seeing a shift backwards to younger people smoking, particularly young females. The more young Australians and even middle-aged Australians there are who once didn't smoke but are now accessing tobacco products and getting addicted to cheap and nasty cigarettes and vapes, the more damage that's going to cause to our health system and to our productivity. On average, 66 Australians still die every day from the effects of smoking. That's a huge number. It's in every state, in every hospital, in every health service. And 20 per cent of the nation's cancer burden comes from the effects of smoking. That includes not just lung cancer but breast cancer, bowel cancer, prostate cancer, bladder cancer—all risks are increased. Oesophageal cancer, I should also say, is a rapidly increasing cancer in Australia. These are from the effects, at least partly, of tobacco related products.

Two of every three long-term smokers will die of a tobacco related illness. As of last August, illicit cigarettes now comprise about half of the cancer-inducing products sold to Australia's 2.7 million smokers. We need to get that number down, and that means controlling illicit tobacco.

This doesn't include also the many Australians who have reduced work or health capacity due to the implications of smoking or those that are presenting to our health services—often time and time again—because of chronic lung disease. This has huge health and economic consequences for our country and our health services.

This leads me to the criminal consequences. Our law enforcement agencies are doing a fantastic job in shutting down and tackling illicit tobacco operations, imports and sales all around the country. Recently, we had many of the well-known Metro service stations closed down for selling illicit tobacco products. It's a difficult challenge. No-one is saying it's not a difficult challenge.

Transnational organised crime groups from around the world, including those from the Middle East, South-East Asia and the Pacific, are flooding our market. They are being led domestically by local criminal organisations via the not-too-disguised black market. You can walk down many of our local high streets and see illicit tobacco openly, or semi-openly, being sold. Recently, a local barber shop that I used to go to was closed down for selling illicit tobacco—shocking.

Our law enforcement agencies are doing their best, but we need to support them and we need to fund them appropriately. In particular, we need to fund their intelligence organisations looking at the business models of these criminal groups. They can be caught. They can be caught by looking at their income. They can be caught by looking at their assets. They can be caught by looking at their taxation records—or non-records—similar to the way Al Capone was caught in the virtual Wild West of the speak-easy age in America. It's a difficult challenge, I agree, but these people can be caught. We need to work hard at it.

Unfortunately, some of these groups from the Middle East and South-East Asia have caused violent criminal acts that have the potential to damage innocent victims and cause destruction and distress in our communities—and they already are, particularly in areas of Sydney and Melbourne. This includes, as we've already seen, episodes of torture and even kidnappings. We saw recently a completely innocent and very elderly man killed by these criminal groups.

We have seen firebombings. They require enormous response time and effort from our police services. We need to make sure we support police and fund them appropriately. In fact, there have been over 175 firebombings of tobacco shops in Australian communities in the last three years. This includes those that are linked to the illicit tobacco trade. Also, violent robberies have grown by more than 150 per cent in Victoria since February 2024 due to tobacco related crime. As reported in the ABC in August last year, Viva Energy petrol stations reported a 27 per cent reduction in tobacco sales due to the rise in illicit tobacco sales elsewhere.

I'd like to echo the comments made by the member for Bruce. Australians are sick to death of the sleazy illegal shopfronts and groups that are popping up across towns and cities. They need to be caught. They need to be punished. They need to be appropriately treated for what they are doing to damage our communities. They serve only the black market. They serve only criminal organisations and they will, if left unchecked, destroy our communities.

Our government is working with and supporting the states and territories to shut down the illegal shops and disrupt the trade. But more support is needed from the states themselves. The financial consequences of these issues are huge. Despite the best efforts of past policies, it's unfortunately still quite lucrative for those foreign based criminal organisations I mentioned earlier to flood the Australian market with illicit tobacco products.

This bill will rebalance the risk-to-reward calculation for criminal actors involved in the illicit tobacco trade by increasing the consequences. If this doesn't work, more will need to be done. The reforms will ensure Australia's proceeds of crime regime provides law enforcement with more techniques and the ability to prevent offenders from benefiting from the criminal profits generated from illicit tobacco, empowering law enforcement to hit criminals where it hurts and keep doing it. It will also clarify, streamline and strengthen our existing information-gathering and confiscation mechanisms to increase the effectiveness of law enforcement outcomes. As I've said, we need to concentrate on the business models of these groups.

Getting information to the right law enforcement bodies to respond appropriately is important. These reforms will enable information obtained through proceeds of crime investigations to be shared with other Commonwealth regulators and law enforcement activities. It'll help those regulatory bodies responsible to identify and act against those that continue to assist these criminal actors. These are not benign crimes; these are life-threatening crimes, and they need to be treated appropriately. This bill also recognises the need for a coordinated whole-of-government response to combat illicit tobacco markets. This includes local government, state government, planning authorities and federal government. We all need to work together on this, and we will do so. It recognises the need for all governments to work together.

Further, 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. Our entertainment and clubs industry also needs to be involved in this with their propensity to allow money laundering to occur in gambling venues. That needs to be treated appropriately and seriously by law enforcement. There are hundreds of high-risk bank accounts being reviewed and closed down, and suspicious transactions are being reported. This needs to occur in the gambling industry as well, which can be used for money laundering.

Law enforcement will benefit from the modernisation of the existing proceeds-of-crime search warrant framework, and it's important that we strengthen that. When the Proceeds of Crime Act was enacted in 2002, its search warrant framework mirrored the Crimes Act at that point. However, it's now been widely expanded, and this is very important. The amendments would strengthen our law enforcement partnerships and the national response to combat illicit tobacco, and we need to continue to do so. The nature of organised crime and the sophistication of cross-border networks are increasingly challenging, but we can meet that challenge and get rid of illicit tobacco. We must continue to do that.

Calls to reduce the regulatory frameworks and to reduce the excise are ridiculous, don't understand the health consequences and should not be tolerated.

Sophie Scamps (Mackellar, Independent) | Link to this | Hansard source

I rise to speak on the Combating Illicit Tobacco Bill 2026. This bill responds to the Illicit Tobacco and E-cigarette Commissioner's 2024-25 report, which sets out four key actions needed to combat the illicit tobacco market in Australia. These are: stronger consequences for criminal actors, improved multiagency capability, unified information and data, and demand reduction.

The bill expands law enforcement powers to investigate illicit tobacco related offending, including computer access and surveillance capabilities. It also increases the penalties for people involved in illicit tobacco offences relating to the importation, possession, buying, selling, supply, production and manufacturing of these illegal products. These are positive and much needed steps. In recent years, Commonwealth, state and territory governments have taken commendable action to strengthen regulation, enforcement, licensing and penalties to curtail both legal and illegal tobacco use. Legislative reforms, including the Public Health (Tobacco and Other Products) Act 2023, reflect the Commonwealth's ongoing commitment to tobacco control.

The Commonwealth allocated $156 million in March 2025 and a further $20 million in the recent budget to strengthen compliance and enforcement action. The government has also established the Illicit Tobacco National Disruption Group, bringing together law enforcement agencies and regulators at both the Commonwealth and state and territory levels. The group targets mid-level criminals and enablers operating through small businesses, intermediaries and sole traders who import, distribute or sell illicit tobacco and vapes. These reforms have already contributed to the seizure of billions of illegal cigarettes, tonnes of loose leaf tobacco, vapes and large amounts of cash.

But the reality remains that large volumes of illegal tobacco are still flooding the Australian market and ending up in the hands of consumers. The ITEC Commissioner estimates that, at current tobacco consumption trends, the illicit tobacco market now comprises 55 per cent of the total domestic tobacco market in Australia. In addition, it's estimated that 95 per cent of vapes purchased in Australia are illegal.

The enforcement challenge is therefore real and urgent. The rapid growth in tobacconists and convenience stores across Australian shopping strips is undermining years of public health progress. Research shows that the efforts to quit and success in quitting fall as tobacco retail availability increases. Generation Vape research shows that young people are regularly exposed to vaping products sold illegally through retail outlets and informal channels. Disposable flavoured vapes and oral nicotine pouches are being sold from retail shops, with storefronts advertising products popular with children and young people, including American candy and novelty toys. This normalises nicotine use and increases the risk of addiction, reinforcing the need for decisive action to disrupt illicit supply and the retail environments that place young people at risk.

A recent survey of over 5,000 Australian adults, conducted by the Cancer Council's Centre for Behavioural Research in Cancer, reveals a clear mandate for reform not only to tackle illicit tobacco but to address the sheer oversupply of tobacco retailers across the country. These concerns are strongly reflected in my electorate of Mackellar on the Northern Beaches of Sydney. Residents are increasingly alarmed at the rapid spread of tobacconists and vaping stores across their communities, particularly in the neighbourhood shopping strips and areas close to schools. In suburbs such as Newport, Dee Why, Mona Vale, Frenchs Forest, Narrabeen and Avalon, locals report a surge in shopfronts selling tobacco, vapes and sweets aimed at young people, and when one shuts down it seems like another one just pops up.

Residents have raised serious concerns about the influence of these shops on young people, the apparent ease with which illegal products are being sold and the broader role some of these businesses may be playing in enabling organised criminal activity in our suburbs. One Newport resident expressed concern about the number of vaping shops 'sneaking into our community and drawing in our youth'. They said, 'I really hope you can help and change this increasing threat to our community's health.' A resident of Bilgola Plateau wrote to me about the opening of a tobacco and vape store less than 500 metres from Bilgola Plateau Primary School. They raised concerns about the influence this shop could have on local children, saying:

Even more troubling is the shop's decor, which is styled like a candy store. This seems like a deliberate tactic to attract the attention of young children, which is both inappropriate and irresponsible. The notion of cheap cigarettes and sweets being sold under the same roof within walking distance of a primary school is not just disturbing. It's unacceptable. What kind of message are we sending to the next generation?

I completely agree.

This is why enforcement cannot be limited to the border. It must also reach the retail environments where illicit tobacco, illegal vapes and other nicotine products are being sold directly to our communities. It's imperative that state and territory tobacco-licensing inspectors have the authority, resources and powers they need to act against retailers engaged not only in the illicit tobacco trade but also in the illegal supply of non-therapeutic nicotine products.

The Australian Council on Smoking & Health recently released an illicit tobacco leaderboard, comparing the progress of each state and territory in tackling illicit tobacco. Queensland and South Australia are identified as frontrunners in enforcement and reform. Other jurisdictions, however, are only just beginning to scratch the surface. Cancer Council Australia has made it clear that coordinated, vigorous and proactive compliance and enforcement between all jurisdictions is needed to protect our communities. This is a nationwide issue. Around 40,000 stores sell tobacco in Australia, despite fewer than 10 per cent of Australians smoking. While all states and territories now have licensing schemes in place for tobacco retailers, and many have strengthened legislative controls, we need to do more—much more.

Divergences in the scope and administration of these licensing schemes have meant that some states have been more proactive and effective in their compliance and enforcement than others. New South Wales, Queensland and South Australia, in particular, have enacted legislative measures to broaden the enforcement powers of licensing authorities and increase penalties for noncompliance. But enforcement capacity also varies considerably across jurisdictions. According to reported figures, Queensland Health has 200 authorised persons, the New South Wales department of health has 78 inspectors, South Australia's Consumer and Business Services has 45 authorised officers, the Western Australian Department of Health has 40 investigators, and Tobacco Licensing Victoria has just 14 licensing inspectors.

Authorised officers who enforce penalties against tobacconists and retail stores selling illicit tobacco should be specialist enforcement officers who receive the right training, resources and support to deal with organised crime. This is grounded in Better Regulation Victoria's Review into Victoria's approach to illicit tobacco regulation, done in 2021. This highlighted concerns that environmental health officers were underresourced and lacked the skills and support to investigate organised-crime-linked offences. This issue was also raised by submitters to the Parliamentary Joint Committee on Law Enforcement inquiry into illicit tobacco in 2019.

Consistency across all jurisdictions matters, and we have known this for a long time. At the start of the 2019 inquiry, which began in 2015 and lapsed twice before it was finally completed in 2020, the committee heard that the illicit tobacco market in Australia was 'flourishing'. Chief among the reasons why was the 'lack of coordinated enforcement'. Yet, over 10 years later, we are still talking about the need for national consistency in enforcement.

To stamp out illicit trade, states and territories must have both the legal authority and the enforcement capacity to respond to the scale of the problem in their own jurisdictions. We need firm, effective and nationally consistent enforcement, right now. This includes addressing regulatory gaps that leave our children unnecessarily exposed to tobacco promotion in retail environments. These gaps include the absence of restrictions on the location of tobacco retailers, including proximity to schools, playgrounds or youth services; a lack of bans on child-friendly displays in tobacconists' windows or at their entrance points; and a lack of prohibitions on selling tobacco in shops that primarily cater to children. These gaps present a clear and urgent opportunity to further strengthen tobacco control laws.

Australia's National tobacco strategy 2023-2030 includes the priority action item of exploring 'options to further regulate where tobacco products are retailed, including regulatory approaches to control or restrict the number, type and location of tobacco outlets'. Restrictions on the number and locations of tobacco licensees was also a recommendation of the Victorian parliament's Public Accounts and Estimates Committee inquiry into vaping and tobacco controls in 2024.

The protection of our children must be a guiding principle of any policy that regulates the density and location of tobacco retailers. This includes setting minimum distance requirements between tobacco outlets and youth focused locations, such as childcare centres, schools and sporting grounds. Internationally, municipalities such as Huntington Park and Santa Clara county in California have implemented requirements for minimum spacing between tobacco retailers of 200 feet and 500 feet respectively. Other strategies include capping the total number of tobacco retailers based on population size—a model used in Hungary, where only one tobacco shop is permitted per 2,000 residents. Similarly, San Francisco has both capped the total number of retailers per district and banned new outlets from opening within 500 feet of an existing store.

The health of Australians must come first. Smoking is a known cause of 16 types of cancer. Two out of three people who continue to smoke will die as a result of their addiction to these products. The real crisis is that, if we continue to allow illicit tobacco to exploit our communities, more of these preventable deaths will occur. That's why efforts to reduce the supply of illicit tobacco must be matched by efforts to reduce demand. The ITEC Commissioner has identified several factors driving the illicit trade, including a lack of consumer awareness about the links to organised crime and the ease with which consumers can access illegal tobacco through retail and online channels.

We must be clear with the Australian public: illicit tobacco is not harmless. It fuels organised crime, it undermines public health laws, it exposes young people to addictive products and it makes it harder for people who smoke to quit. That's why demand reduction must be central to the national response. This means stronger public education about the harms of illicit tobacco and vaping; it means better access to cessation supports for Australians trying to quit; it means ensuring young people understand the risks of nicotine addiction; and it means making sure our public health system is equipped to respond to both smoking and vaping related harms.

The bill before us is an important and long-overdue part of this response. It strengthens penalties, it improves enforcement tools, it supports greater disruption of the illicit tobacco market and it sends a clear message that criminal actors profiting from addiction and harm will face stronger consequences. But there is certainly more work to do. For the sake of our children, our communities and the health of Australians, we cannot allow another decade to pass while criminal networks exploit addiction, undermine our laws and place young people in harm's way. I commend the bill to the House.

Tania Lawrence (Hasluck, Australian Labor Party) | Link to this | Hansard source

People who visit my electorate office in Midland know the stretch of Great Eastern Highway very well. We're at 257 Great Eastern Highway, opposite the Midland Junction Arts Centre, in the middle of a busy, growing part of our community. Midland Gate is nearby. There are cafes like Turquoise and Nellie's where people catch up after school drop offs, where shiftworkers grab coffee and where local business owners know their customers by name.

A couple of years ago, just a short walk from my office, there was a cafe called The Robot Bun Factory. It had personality, great coffee, bao buns, bright colours and the cutest collection of robots, like Ollie and C3PO. Young locals were having a go and building something of their own. But next door was a tobacco store. I'm not making any allegation about that business but, one night in 2024, that shop was ramraided and set alight in a cold, calculated, premeditated act. The ferocious blaze spread, leaving a trail of destruction of over $2.3 million. The cafe was lost, with three other businesses suffering significant damage. No-one was physically hurt, but the businesses never recovered. Two years later, those buildings still sit there, largely still vacant, as a reminder that organised crime doesn't stay hidden in dark alleyways or exist somewhere else. When it takes hold, communities feel it. Local businesses pay for it. Workers pay for it. Neighbours pay for it.

And that is why the Combatting Illicit Tobacco Bill 2026 matters: because this isn't really a debate about tobacco; it's a debate about whether organised crime gets to operate in plain sight in our suburbs. People in places like Midland know what this looks like. They see the shopfronts. They hear about the firebombings. They see legitimate businesses being undercut and communities being left to pick up the pieces. They understand instinctively that this isn't harmless. Illegal tobacco isn't a victimless shortcut or cheap smokes over the counter. Behind it are organised criminal networks making enormous profits and reinvesting those profits into intimidation, violence and wider criminal activity. When crime becomes normalised in our local shopping strips, everyone loses. Legitimate retailers have been calling for stronger action. Public health advocates have warned that illegal tobacco undermines decades of work reducing smoking rates. Law enforcement agencies have made clear that this is becoming more sophisticated and more entrenched.

Parliament has a responsibility to respond, and this bill does it in a practical way. It strengthens penalties for illicit tobacco offences. It expands investigative powers. It strengthens the proceeds-of-crime laws so criminals' profits can be seized. Organised crime is a business model and, if the risks stay low and the profits stay high, the problem grows. This bill changes that equation, and it doesn't stand alone. In Western Australia, the Cook government has already stepped up enforcement, increased compliance activities, strengthened penalties and given authorities stronger closure powers against illicit operators. That matters because organised crime doesn't stop at state borders, and governments can't afford to work in silos either. The Albanese government and the Cooke government are approaching this the same way: follow the money, disrupt the networks and back the communities doing the right thing.

No-one expects this bill to solve everything, but communities expect us to act. They expect us to back lawful businesses, they expect us to protect public health, and they expect organised crime to face consequences. People in Hasluck don't want criminal activity becoming part of the background noise of everyday life. They want safe shopping strips, thriving local businesses and confidence that the rules apply equally to everyone. This is why I support the passage of the Combating Illicit Tobacco Bill 2026. This legislation matters. It's not simply a question of tobacco policy, and it is not simply a question of the integrity of the revenue base. This is a question of organised crime and, above all, community safety.

It is, as we know, a national issue, and we heard from members who spoke earlier about the shops down the road from their electorate offices. They could have easily been describing my office on our street in Western Australia. Across Australia, people see the visibility of this trade, and they understand that it is not harmless. They understand that, when organised crime establishes itself openly in suburban shopping strips and commercial precincts, the risk does not stop with tax avoidance or unlawful retailing; it spreads to intimidation, violence, fire bombings, arson and fear. That is what the communities in places like Midland are seeing, and that is why the parliament has to act.

Legitimate retailers have real interests in stronger federal action and deserve our support. Theo Foukkare, the CEO of the Australian Association of Convenience Stores, welcomed the stronger Commonwealth intervention against the illicit tobacco market, saying it's 'a crucial step towards fighting one of the biggest public health, community safety and economic threats to this nation'. He said it was 'a big step forward' and that coordinated federal action was 'to be applauded'. The Australian Association of Convenience Stores represents about 7,000 stores and 75,000 workers nationwide, and it recognises that organised criminal networks are undercutting lawful trade, distorting the market and putting communities at risk.

Public health experts have also spoken out. Anita Dessaix of Cancer Council NSW said plainly:

The sale of illegal tobacco undermines decades of public health progress.

That same statement called for governments to apply a 'gold standard of tobacco sales regulation' and argued that stronger retail controls would 'make monitoring and enforcement of illegal tobacco sales easier', calling that approach 'a win-win solution'. We need to defend the public health gains Australia has fought hard to achieve over many decades.

The problem is not going away. Record seizures have occurred over the last financial year, with an over 320 per cent increase in the number of cigarettes seized compared with four years ago. Stronger penalties and powers are intended to ensure law enforcement agencies can not only seize illicit tobacco but prosecute those behind the trade and choke off the criminal profit stream. In media terms, this issue is often framed as 'cheap smokes on the high street', but that framing completely understates the reality. Behind those glossy, paper-thin retail shopfronts sit sophisticated and often transnational organised crime networks which are operating across borders and reinvesting profits into wider criminal activity.

These aren't victimless crimes. Minister Julian Hill has noted that the trade fuels violence, firebombing and intimidation and that it risks the unwinding of decades of success in tobacco control policy lowering smoking rates in Australia. He also said they are not victimless crimes. They harm communities, honest retailers, workers and public safety. That's exactly right and that aligns with the experience in my own community of Hasluck, including the Robot Bun Factory. Leslie and Neil put their heart and soul into creating this wonderful community space not just for those of us who enjoy our coffee and bao buns; they also host comedy nights and beautiful opportunities for local artists to exhibit. And it's not just the space they created for community; the workers have also suffered as a consequence of this firebombing. Annalise, Mae, Ben, Tess, Amber, Penny, Laica, Debbie, Jean, Mark, Serenity, Antia and Amy all loved to work in the Robot Bun Factory and no longer can.

This bill responds to this reality in a deliberate and structured way, and it does two central things. First, it seeks to rebalance the risk-to-reward calculation for criminal actors engaged in the illicit tobacco. And, second, it strengthens the proceeds of crime regime to target the profits generated by that illicit trade. It does that by increasing penalties for illicit tobacco offences; expanding investigative powers, including the telecommunications interception for relevant offences; and strengthening the mechanisms available to seize criminal assets. Those settings matter, because criminal networks calculate risk. If the profits are enormous and the consequences are manageable, the trade grows. If penalties bite, if investigative powers are stronger and if criminal assets can be confiscated more effectively, the calculation shifts.

The bill creates new offences for large-scale illicit tobacco activity linked to organised crime. It increases penalties across importing, possessing, buying, selling, producing and manufacturing. It expands unexplained wealth and proceeds of crime tools, and it enables enhanced law enforcement powers, including wire taps for serious tobacco offences. This is not symbolic legislation. It is practical legislation aimed at disrupting that business model of organised crime.

The member for Canning really needs to get behind this bill rather than moving amendments that he pretends would bring in a better one. This bill is not about making life easier for tobacco companies and it is not about making excuses for the legal tobacco trade. It is about crime. It is about criminal syndicates. It is about the people who profit from intimidation, illegal supply chains and violence.

I also acknowledge that the bill is not by itself the whole solution. The government's own materials explicitly state that there is no single solution to the illicit tobacco market and that a comprehensive and integrated approach is required. That is correct. The bill must work alongside sustained state and federal enforcement, retail regulation, intelligence sharing and coordination across jurisdictions. But the fact that it is not the whole solution is not an argument against it. On the contrary, it is an argument for getting one important part of the response right.

In Western Australia, the state government has commenced significant enforcement action to deal with the illicit tobacco problem. It has boosted compliance capacity, deployed Superintendent Steve Post into the Department of Health, more than doubled the inspector numbers, passed tougher laws with penalties up to $4.2 million for individuals and $21 million for companies and 15 years for imprisonment. In fact, the guy that firebombed in my community has just been charged with six years imprisonment. And it introduced closure powers for shops caught selling illicit tobacco and vapes. The latest Department of Health publication of closure orders lists 63 premises now shut under the new regime, alongside major seizures of loose tobacco, cigarettes and vapes. Governments need to cooperate if this scourge is to be met and dealt with, and I'm glad to say that the Albanese and Cook governments are of one mind in this regard.

Public confidence requires that we act effectively against criminal enterprise conducted in plain sight. In Hasluck and in every town and city in Australia, people are increasingly aware of the visibility of illegal retail operations. They see the shopfronts. They hear about the firebombings. They see lawful businesses undercut. They know that the issue is not abstract. They are properly concerned about whether enforcement is keeping pace, and this bill is part of the answer to those concerns. It signals clearly that organised crime will be targeted, profits will be confiscated and the legal framework will keep up with emerging threats.

It's also worth remembering that this legislation does not stand alone. It sits within a broader national effort involving Commonwealth agencies, state and territory governments and financial regulators. The government's materials describe a coordinated approach involving stronger penalties and enhanced law enforcement powers and tools directed at illicit profits. This coordination is critical because the illicit tobacco market, as I say, doesn't sit neatly within jurisdictional boundaries, and neither can our response. Organised crime networks do not stop at the state border, and the law should not behave as though their operations do.

Legitimate retailers have called stronger action a big step forward. Public health experts have warned that illicit tobacco undermines decades of progress. Independent commentary has recognised that stronger penalties are welcomed if enforced properly, and the government has put before the House a bill that strengthens offences, penalties, investigative powers and asset-seizure tools directed at organised crime.

As Theo Foukkare of the AACS put it, 'This is only the beginning of a long fight.' He is right about that, but it is a fight that this government is willing to take on. We owe that to the lawful retailers, we owe it to the agencies tasked with enforcement and, most of all, we owe it to the communities who should not have to live alongside this intimidation and the risks associated with criminal violence. For this reason, I commend the bill to the House.

Zali Steggall (Warringah, Independent) | Link to this | Hansard source

I rise on this really important topic. I'm so deeply concerned about the resurgence of tobacco, of smoking, such a massive public health issue—and vaping—and of course the association with crime. This bill, the Combatting Illicit Tobacco Bill 2026, is seeking to do three things: protect public health, protect communities from organised crime and protect honest small businesses from being undercut by illegal operators.

Australia has spent decades building one of the most successful tobacco-control systems in the world through plain packaging, advertising restrictions, public health campaigns, excise settings, quit support and strong regulation, and that's a great achievement. But that success is absolutely being challenged by this fast-growing illicit tobacco and vaping market, and I can't help but feel that the government has been asleep at the wheel on this one. We've seen this coming over the last few years, and it has taken too long for governments, state and federal, to respond to this crisis.

The illicit tobacco trade is not a small side-hustle. It is a major criminal market. The Illicit Tobacco and E-Cigarette Commissioner has estimated that illicit tobacco made up around 55 per cent of the total tobacco market in 2024-25, with an estimated value of $5.6 billion and excise revenue evaded—so, lost—in the range of $7.7 billion to $11.8 billion. Those figures should really stop us in our tracks. It's money that should be supporting public services that is flowing instead to organised crime. Now, when you think of those kinds of numbers, $7.7 billion to $11.8 billion, that's a huge investment in law enforcement and other methods to try and make sure we crack down on the illicit tobacco market.

It's an organised crime issue, and it is not a victimless offence. Profits from illegal tobacco fuel violence, intimidation and firebombings, and risk undermining decades of tobacco control. That's why I support the central intent of this bill: stronger offences, stronger penalties, stronger proceeds-of-crime tools and stronger enforcement powers targeted at those who import, manufacture, possess, sell and profit from illegal tobacco sales. But why has it taken this long? I don't understand the delay. If ever there were an area of urgency for the government—surely, this level of organised crime and lost revenue should compel fast action. We know enforcement alone isn't going to solve this problem. It must sit alongside public health education, quitting support, coordinated state and federal enforcement, transparent oversight and proper resourcing.

I think all of our communities are witnessing this. It's an issue directly relating to public health in Warringah. I've already spoken in this place about the concern from parents, carers and educators in Warringah about vaping and illegal tobacco products being too accessible to young people.

I don't understand why these stores are still being opened—why the implementation of stronger controls has not happened. In 2023, I raised concerns that illegal vape shops were popping up in Warringah, with parents deeply worried about vapes in schools and shops operating close to schools. I also called for stronger action on importation, disposable vapes and retail proximity to schools, and government assured us that they were doing that. In 2024, I again spoke in support of vaping reforms—noting the regular concern raised by Warringah parents, carers and educators about young people accessing vapes—and the need for strong national legislation to ban importation, marketing, distribution and commercial possession. The much greater marketing, or information, campaign for people to be aware of the dangers and the toxicity and the risks of vaping has still not really happened. Those concerns have only become more visible throughout our community.

Enforcement action across Warringah has escalated in recent months, but, again, it is piecemeal. In March 2026, the Manly Observer reported that five stores in Dee Why had been closed in under a month because of illicit tobacco sales, with NSW Health inspectors seizing hundreds of thousands of illicit cigarettes and thousands of illegal vapes across New South Wales enforcement actions. Northern Beaches Advocate reporting described local concern about young people moving in and out of shops to buy vapes, and residents saying the problem has become an open secret. And I agree: they're there. These stores are there for all of us to witness, and yet they don't seem to be closed down. This reflects why many parents already know the problem. The legal framework says that young people should not be buying these products, but the lived reality has been so much messier. A product that should not be in the hands of children is too often being sold through ordinary-looking shopfronts. How are they still there?

The Australian Institute of Health and Welfare has found that younger people are more likely to use e-cigarettes than older people and that people in the most advantaged areas are among those most likely to use e-cigarettes. Yet we don't have the campaigns explaining the dangers.

Australia has made extraordinary progress in reducing smoking, but that progress can't be taken for granted and, I would argue, it is directly under attack. Nationally, daily tobacco smoking fell from around 12 per cent in 2016 to 8.3 per cent by 2022-23, and daily e-cigarette use increased half a per cent to 3½ per cent over the same period.

Amongst young people, the increase in vaping has been particularly alarming. The AIHW reported that, in 2022-23, around 28 per cent of 14- to 17-year-olds had used an e-cigarette—almost triple the rate from 2019—and among 18- to 24-year-olds, around 49 per cent had used an e-cigarette. More than 87 per cent of 14- to 17-year-olds who used nicotine e-cigarettes obtained them without a prescription.

In New South Wales, tobacco smoking has fallen to the lowest rate recorded. But vaping remains a serious challenge, with New South Wales Health reporting that 16- to 24-year-olds have the highest vaping rate of any age group, at around 20 per cent, and many do not understand the toxicity and the dangers of vaping and the amount of substances that are contained within those vapes.

The problem is therefore not just illegal tobacco in isolation; it is a collision of three trends: a large and profitable illicit tobacco market; a youth vaping market that has normalised nicotine use for a new generation; and organised crime exploiting the gaps between Commonwealth, state and territory enforcement. Some argue that Australia's high tobacco excise has helped create the illicit market and that penalties alone will not solve the problem. I think the enforcement question, especially at the borders, has to be looked at and properly resourced. Price is one of the most effective public health levers to reduce smoking. If we respond to organised crime by making legal tobacco cheaper and easier to access, we risk handing a policy victory to the very industry whose products cause preventable disease and death.

The answer is not to weaken public health. The answer is to make crime less profitable, enforcement more coordinated and quitting support more accessible.

In practical terms, this bill does four important things. First, it increases penalties for illicit tobacco offences, including importing, possessing, buying, selling, producing and manufacturing illicit tobacco. Second, it creates stronger offences for large-scale illicit tobacco activity connected to organised crime. Third, it expands proceeds-of-crime and unexplained-wealth tools, so that law enforcement can better target the profits, not just the product. And fourth, it enables enhanced investigative powers for serious tobacco offences, including telecommunications interception warrants in appropriate cases. This is all in the right direction.

If organised crime groups can treat penalties as a cost of doing business, then the setting is just not right and the law is not doing its job. If illegal retailers can reopen under another name, or if profits can be hidden faster than products can be seized, then enforcement just becomes a game of whack-a-mole and is useless.

This bill is no silver bullet, but it will mitigate some part of the problem—if it's effectively implemented. And that's my big 'if'.

Moving forward, the Commonwealth, states and territories need a nationally-coordinated enforcement model. Criminal networks are importing tobacco through national supply chains, moving it between states and selling it through suburban shopfronts, and they're hiding behind changed company names if regulators shut them down. That means that each level of government owns a small piece of the puzzle and organised crime slips through the gaps.

Stronger powers mean little unless agencies have the people, the data systems and investigative capacity to use them. The Illicit Tobacco and E-cigarette Commissioner's role is important, because it's designed to provide strategic leadership and a data-driven approach across governments—and this is where modern technology will be of assistance.

Public health is also an essential piece of solving the problem. Enforcement must be paired with prevention and information. Young people need clear education about nicotine addiction and vaping harms. Smokers need practical quitting support. Communities need confidence that the goal is not simply protection of federal revenue, but harm minimisation and health outcomes for the community.

On balance, this bill responds to a real and worsening problem, but it doesn't solve every driver of illicit tobacco. It will give law enforcement stronger tools to disrupt organised crime and protect the integrity of Australia's tobacco control system, but only if properly implemented and resourced.

So I support this bill, because communities like Warringah want practical action. Parents want to know that children are not being targeted with addictive products. Schools want support, not another wave of nicotine products in bathrooms or playgrounds. Honest retailers want a level playing field, and the community expects that organised crime should not be able to build a billion-dollar market out of addiction and poor health outcomes.

Australia should not go backwards on tobacco control. We should make the lawful, healthy choice the easy choice: do not sell addictive products to children, do not launder crime through corner stores and do not ask honest communities to pay the price.

So I plead with the government to urgently get a clear, impactful advertising campaign to inform Australians of the risks and harms of vaping. You need to keep that information out and give education tools to every generation—and this younger generation needs them urgently.

So many Australians are simply ignorant of the toxic harm of vapes for those who use them, and for those who are impacted by secondary proximity but also by the residue that falls on every surface where a vape is utilised and extends its harm to third-party contact. How many in this place even know that vapes create third-party contact harm: that, if someone were to enter a house, bathroom, bedroom or anywhere where a vape has been smoked previously, a residue remains on the surface that is toxic to them, and so, if a child or other family member happens to touch that surface and put it anywhere near their mouth or ingest it, they are then at risk? That is the level of toxicity of vaping, and we have not seen any urgent education or communication campaign around these harms. So please—I plead with the government—get proactive about this. Do more.

Dan Repacholi (Hunter, Australian Labor Party) | Link to this | Hansard source

Last week, I was talking to a small-business owner in my electorate. Like a lot of local shop owners, he's worked hard for years—long hours, early starts—looking after customers, looking after staff and doing the right thing. He said, 'Dan, I'm competing against people who don't play by the rules'—

A division having been called in the House of Representatives

Sitting suspended from 11:30 to 11:47

A couple of weeks ago, I was talking to a small-business owner in my electorate. Like a lot of local shop owners, he's worked hard for years—long hours, early starts—looking after customers, looking after staff and just doing the right thing. He said, 'Dan, I'm competing against people who don't not play by the rules, not people who found better business models, not people who work harder, not people who just are genuinely trying to do the wrong thing bu0t people that are selling illegal tobacco, people linked to organised crime, people making huge profits while honest businesses are left trying to compete against products that shouldn't even be on the shelves.' And that's really what this bill is about. It's about fairness, it's about public safety and it's about making sure organised criminals don't see Australia as an easy place to make billions of dollars, because that's exactly what's happening here.

When most Australians hear the words 'illicit tobacco' they probably picture someone selling cheap cigarettes at the back of their shop. But the reality today is very different. This is no longer just a tax issue. It is no longer just a health issue. It's becoming a serious organised crime issue. The Illicit Tobacco and E-Cigarette Commissioner has estimated the illegal tobacco market in Australia is now worth somewhere between $4.1 billion and $6.9 billion. Just think about that for a moment: billions of dollars—not millions, billions.

That's money flowing directly into criminal networks, and those criminal networks don't stop at tobacco. The profits from illicit tobacco help fund other criminal activities: money laundering, scams, drug trafficking, violence and intimidation. Increasingly, we're seeing that violence spill into our communities. We've seen the reports, the firebombings, the threats, the criminal groups fighting over territory, the businesses being targeted, the families being frightened and the communities being put at risk.

These aren't victimless crimes. There are real victims. They're honest retailers who follow the law. The worker whose workplace is threatened, the family living next door to the business that became the target of organised crime, the young person who gained access to unregulated products—every one of them pays a price, and that's why we're taking action. If organised criminals can make billions of dollars while facing relatively low risks, then we shouldn't be surprised when the problem keeps growing. The truth is simple: for too long, the risk hasn't matched the reward. Criminal groups have looked at illicit tobacco and decided the profits are worth it. This bill changes that calculation. It sends a clear message: if you want to profit from illicit tobacco in Australia, the consequences will be serious.

This legislation increases penalties for a range of illicit tobacco offences. It strengthens the ability of law enforcement agencies to investigate these crimes, and it improves our capacity to go after the money. Let's be honest. Organised crime isn't driven by ideology. It's not driven by principle. It's driven by profit. The money is the motivation. If we want to disrupt these criminal networks, we have to take away the profits. We have to make this trade less attractive. We have to make it harder to operate. We have to make it easier for law enforcement agencies to identify, investigate and prosecute those involved. That's exactly what this bill does.

I think it's important that we talk about what this actually looks like on the ground. Sometimes, when we stand in this place and talk about organised crime or billions of dollars in illegal markets, it can sound distant. It can sound like something's happening somewhere else, but that is not the reality. The reality is that this impacts local communities every single day. In my electorate, like in electorates right across Australia, people want the same basic things. They want safe streets. They want thriving local businesses. They want their kids growing up in a community where people follow the rules and where criminal behaviour isn't rewarded. That's not asking for much, but that's exactly what's being undermined right now when organised crime gets a foothold in an industry like illicit tobacco.

When I speak to local traders, they often tell me that they are frustrated. It's not because they're afraid of competition. Competition is part of business, and a good part. What frustrates them is seeing people profit from breaking the law while they are doing the right thing. They pay their taxes. They meet their obligations. They employ local people. They follow regulations. Then they watch someone down the road selling illegal products at prices they simply can't compete with and wonder how that is fair. Frankly, they're right to ask that question, because it isn't fair. That's one reason why this bill matters so much. It's about backing the businesses that are doing the right thing. It's about making sure honest operators aren't left competing against organised criminal networks.

Importantly, it doesn't just target the products; it targets the profits. Anyone who has spent time looking at organised crime knows one thing: follow the money. Follow the cash. The money tells the story, the money reveals the network, the money reveals who's involved, and the money is often the reason the crime is occurring in the first place. That's why the proceeds of crime measures in this bill are so important. If we can strip away the profits and remove the incentives, if we can take away the money, we can weaken the criminal enterprise. If we can make this trade less lucrative, fewer criminal groups will see it as a worthwhile risk. That is common sense. It's something Australians understand. People understand that, if someone profits from criminal activity, they shouldn't get to keep the proceeds of that crime. That principle is widely accepted. This bill strengthens our ability to make sure that actually happens. I think Australians would expect nothing less.

Another point worth making is that this legislation isn't being developed in isolation; it's part of a broader national effort. Over recent years, we've seen stronger cooperation between governments than ever before. The Commonwealth is working more closely with states and territories. Law enforcement agencies are sharing information more effectively. Resources are being coordinated; operations are being coordinated—and that matters, because criminal groups are coordinated; they're organised; they're adaptable; they move quickly. Government has to be capable of doing the same as well.

We've already seen encouraging signs. In some jurisdictions where enforcement activity has been intensified, illegal trade has fallen significantly. That shows something important: these criminal operations are not unstoppable. They can be disrupted; they can be dismantled. But it requires persistence, it requires coordination and it requires governments being prepared to act. And that's exactly what we're doing.

I also want to acknowledge the work being done by frontline officers, whether it's the Australian Border Force officers intercepting shipments before they even enter the country, investigators tracking criminal networks, or state enforcement officers carrying out inspections and closures. These people are doing important work every day. Often, it's work that Australians never see but communities benefit from nonetheless. When a shipment is seized at the border, that's a success. When an illegal operation is shut down, that's a success. When criminal profits are confiscated, that is a success. And every one of those successes helps make our community safer.

This bill gives those agencies stronger tools to continue that work—not because we want to create unnecessary powers, not because we want to overreach, but because we want our laws to reflect the seriousness of this threat. The reality is that organised crime has evolved—the methods have evolved; the technology has evolved; the scale has evolved—and our response must evolve, too. If we fail to adapt, criminal groups will exploit the gaps. If we fail to adapt, they'll continue to make billions. If we fail to adapt, communities will continue bearing the consequences.

That's why this legislation is both necessary and so important for right now. It's about giving law enforcement the tools they need. It's about protecting honest businesses. It's about protecting public health. It's also about standing up for communities who are sick and tired of seeing organised crime profit at their expense. That's a goal I think every member of this House can support.

I know some people might ask why stronger powers are needed. The answer is very straightforward. The criminal landscape has changed. The scale of the problem has changed. And our laws need to keep up.

The powers in this bill are not unprecedented. We are not creating some entirely new framework. We are making sure law enforcement agencies have access to tools that reflect the seriousness of the criminal activity they're dealing with, because, when organised criminal groups are using sophisticated communications, moving large amounts of money and coordinating operations across jurisdictions, our agencies need the ability to respond effectively. Otherwise, we're asking them to fight with one hand tied behind their back.

This bill recognises that reality. It allows illicit tobacco offences to be treated with the seriousness they deserve. And that's important, because the consequences of inaction are very real. If we don't act, the illicit market grows. If we don't act, criminal profits increase. If we don't act, more violence flows. And, if we don't act, decades of progress in reducing smoking rates are all put at risk.

Australia has worked hard over many years to reduce smoking rates. Governments of different political persuasions have done a lot in the effort to make this happen. Communities have contributed. Health professionals have contributed. Families have contributed. The results have been significant. But illicit tobacco threatens and undermines that progress.

These products are unregulated. They don't meet Australian standards. Consumers often have no idea what is actually in them. And, because they're sold outside the illegal market, they can be more accessible than they should be. That's not good for public health, it's not good for communities and it's certainly not good for young Australians.

This government has not waited for the problem to solve itself. Since 2023, we've invested heavily in disrupting illicit tobacco and vaping products. We've provided $346 million to the ABF to strengthen enforcement efforts. We've appointed Australia's first illicit tobacco and e-cigarette commissioner. We've established stronger national coordination. We've worked closely with states and territories across this country.

The results are already being seen. Since January 2024, more than 14 million vaping products and accessories have been seized. In just six months last year, more than one billion illicit cigarettes were seized. That's one billion. That figure alone tells you the scale of what we're dealing with. But it also tells us something else. It tells us that our agencies are doing important work. They're identifying these products and intercepting them, and they're stopping them from reaching Australian communities.

This bill helps them even more, because enforcement at the border is only part of the solution. We also need stronger action within Australia. We need stronger coordination, we need stronger investigations and we need stronger consequences. That's why cooperation between the Commonwealth, states and territories is so important, because no single government can solve this alone. No single agency can solve this. It requires everybody working together.

Over the past six months, we've seen significant progress. States and territories are strengthening licensing agreements, they're improving enforcement, they're introducing stronger closure measures and they're looking at tougher consequences for those who facilitate illegal activity. That's exactly the kind of coordination response we need, because organised crime doesn't respect state borders, and our response can't stop at state borders either. It has to be national, it has to be coordinated and it has to be determined.

At its heart, this bill is about protecting communities, it's about protecting legitimate businesses, it's about protecting public health and it's about making sure organised crime does not get richer while Australians pay the price. When people walk into a local shop in Morisset, Toronto, Cameron Park, Kurri Kurri, Cessnock, Singleton or Rathmines, they should have confidence that the business is operating fairly and legally; when families go about their daily lives, they shouldn't have to worry about criminal violence connected to illicit tobacco; and, when organised criminals look at Australia, they should see a country that is serious about enforcement and serious about consequences. That's what this legislation delivers. It's practical, it's targeted and it's necessary, because the choice before us is clear: we can allow criminal groups to continue treating illicit tobacco as a low-risk, high-reward business, or we can act. We can strengthen our laws, we can support law enforcement, we can target criminal profits and we can protect Australian communities. This government has chosen to act, and I commend this bill to the House.

Simon Kennedy (Cook, Liberal Party, Shadow Assistant Minister to the Leader of the Opposition) | Link to this | Hansard source

We will support the Combatting Illicit Tobacco Bill 2026, but it only addresses a fraction of the problem. Illicit tobacco is out of control under this Albanese government. I want to read a letter from one of my constituents who recently wrote to me:

I am writing to complain about the proliferation of tobacconists in shopping centres near high schools. I live at Jannali. There was only one store and the Woolworths that sold such products. And now two more tobacconists/convenience stores—

for a total of three—

have opened in a matter of months.

And the new store next to Woolworths has kids toys and lollies and posters displayed and for sale throughout the store.

There should be tighter regulations on what can be displayed and sold in such stores. And a limit to the number of stores in a km area.

And these stores need to be regularly raided and checked to make sure they are not selling anything illegal to minors like vapes.

A division having been called in the House of Representatives—

Sitting suspended from 12:03 to 12:14

It's not just Jannali where these illegal tobacconists have exploded. It's Miranda, it's Caringbah, it's Cronulla—it's across much of the Sutherland shire and the electorate of Cook. Why have they exploded? The tax is too high. The tobacco tax has allowed an illegal industry to flourish. And we are not closing down the criminals in these illegal tobacconists. This is something this bill does not deal with at all. The tobacco tax is far too high, and it has created the space for an illegal industry to prosper.

These emails get to the heart of the debate. Parents shouldn't have to be compliance officers. A mother and father shouldn't have to walk up and down the local mall in Cronulla or in Jannali and see a shopping centre, wonder whether these are stores that are going to encourage their children with lollies or posters to come in for illegal vapes and worry whether illegal tobacco or worse is being sold behind the counter.

I recently had another email from a constituent in Cronulla. She emailed me with dread about one of her young boys in high school who had become addicted to vaping and nicotine because he was being sold illegal vapes repeatedly in the Cronulla mall. If this is a business operating in plain sight, governments should be enforcing the law. That is what we need. Yes, these amendments increase penalties, and we support that. But laws already exist to stop that, and they do nothing on the size of this illegal industry.

Legitimate retailers also should not be smeared because illegal retailers have invaded their market. There's a man outside Cronulla IGA who sells legal cigarettes at a tobacconist. He sells legal cigarettes in plain packaging in plain sight. This man has to contend with being smeared and, even worse, his livelihood being eroded because just out in the mall are multiple illegal tobacconists selling cigarettes at a fraction of the price, with the government claiming zero tax because they're taxing legal tobacco out of existence.

It's not because there aren't some people trying. In the last financial year, the Australian Border Force seized more than 2.2 billion—that's 'billion' with a 'b'—illicit cigarettes at the border. It seized more than 586 tonnes of loose-leaf tobacco. It seized more than 13.2 million vapes, one for every two Australians. This represented more than $4.7 billion in estimated tobacco duty evasion, and we know we're only capturing a fraction of what is making it through. Think about this for a moment: two billion cigarettes—that's what was seized; imagine what's getting through. And we have some idea, because, right across Australia, illegal tobacconists are popping up everywhere.

This isn't a few opportunists taking some duty-free from the Middle East and shoving it in their carry-on or their check-in. What we're talking about here is an industrial-scale criminal market that the Prime Minister has allowed to flourish. And it's not just the Labor Party federally that has allowed this criminal enterprise to flourish. We've seen it with the CFMEU. We see it within Victoria. This Labor government has a problem with illicit criminal activity in the tobacco market, in the construction market, in the housing market. The Prime Minister needs to stand up and stamp this out, for the mothers in Jannali and the mothers in Cronulla who are writing to me at wits' end because their children are getting addicted to illegal tobacco products. I won't stand for it.

Not only is the trade extraordinary; there is violence. The ACIC report that, since 2023, there have been more than 200 firebombings of stores and three homicides, including an innocent civilian—people getting killed over cigarettes, all because this government has put the tax too high. This is why I reject the idea in this bill that we're simply dealing with a tobacco tax compliance problem. We've stuffed up the incentives monumentally, and the Prime Minister needs to admit this and fix it. Shops are being firebombed, people are being killed, we're seeing an innocent civilian being murdered for illicit tobacco, because they have stuffed it up.

I think back to that mum at Jannali, a resident who sees all these tobacconists opening up in the local shopping centre. They see lollies and toys displayed in those stores and they ask a question: who is taking responsibility for this? Well, the PM should. It's time to stand up. This question deserves an answer. Who is going to take responsibility for this? I'm going to fight for you. I'm going to fight for every person in my electorate who's sick to death of these businesses being unregulated and those few smokers who are sick to death of being charged the proverbial arm and a leg to smoke.

The independent Parliamentary Budget Office estimated that illicit tobacco is around 80 per cent of all cigarettes consumed—80 per cent! We have set this tax so high no-one's buying it legally. I've seen local cops in my area going into the illegal tobacco stores to buy their smokes, and I don't blame them, because we've stuffed this up. We've stuffed it up so badly that what we collect in tax from cigarettes has dropped from $14.7 billion in 2023-24 to $3.6 billion, an $11 billion drop in the tax take. Australians instinctively understand something this prime minister doesn't: the more you tax something—the higher you tax something—the less of it you get. That is why taxation revenue has fallen through the floor on cigarettes despite it being 80 per cent or more of the price of a packet of smokes. The higher you make that tax, the less they'll buy it. They'll go around it.

We're seeing that same principle on display in our housing market: 'Let's tax housing a whole lot more; let's set a minimum 30 per cent tax and a maximum 47 per cent.' In some cases, that's double or triple what people would pay, and—surprise, surprise—we read in their own budget papers that we get 35,000 fewer houses because, the more you tax something, the less you get of it. That's true with cigarettes. It's true with houses. Unfortunately, we have a prime minister who does not understand how business works or operates, and Australians are left to pay the price—Australian renters in Cook, Australian renters in Jannali and mums of local high school students at Jannali High watching these illegal tobacconists spring up like mushrooms all over the place. Not only is a mum having to deal with her young son being addicted to nicotine at school; she's having to deal with rents that are going through the roof because we've got fewer houses—35,000 fewer, according to the Treasury's own budget papers. We have a government and a prime minister who do not understand how business and incentives work and operate.

This isn't something that just the coalition is saying. Those of you in Cook would have heard our premier, Premier Minns, and health minister Ryan Park—a Labor premier and a Labor health minister—take shot after shot at this Labor federal government for not understanding this. Ryan Park recently said that the federal government's excise is 'driving the black market'. That's a direct quote. Premier Minns has talked about how he feels like he's fighting with one hand tied behind his back trying to close these stores down, because he knows what all of us know and what every constituent in Cook knows: this crazy tobacco tax at crazy prices has created and driven this market. This isn't a partisan issue. The Labor premier gets it. The Labor health minister gets it. I get it. The mums and dads of high school students at Cronulla, at Jannali, at Miranda and at Caringbah get it. They are watching their kids get addicted to cut-price vapes and cut-price cigarettes from the illegal tobacconists springing up everywhere.

It's the Commonwealth agencies that control our international border. They are the ones that should be holding organised crime to account—and this is what it is: deep, organised crime. They used to sell heroin. They used to sell meth. They used to sell cocaine and MDMA. Now they're selling packs of Double Happiness to 16-year-olds down at Cronulla mall and Jannali mall. That's what's happening. This isn't your friendly local retailer bringing back a few boxes of duty-free. We're talking about 2.2 billion cigarettes seized. That's a fraction of what's getting through.

Parents at Jannali or Cronulla don't care about which level of government or which subsection of the act is involved. They don't care that the penalties you already aren't enforcing are being doubled or tripled—which is what we're doing in this bill, which I support. What they want is leadership. They want a prime minister who leads and stands up for them, who doesn't push a piece of political legislation that doesn't deal with the underlying problem of excise.

We need a serious conversation about where these businesses are opening, how many can be in a cluster and whether they are actually legal, because most of them aren't. I feel for that guy in the Cronulla mall, outside the Cronulla IGA, selling plain-packaging cigarettes to people over 18—not selling illegal vapes—and watching his margins get eaten up by organised crime because this government is turning a blind eye.

We need to be much tougher where operators are caught deliberately selling illegal products. These guys are operating in plain sight day after day, selling to minors. If the penalty is simply to be absorbed as a cost of doing business, because the profit margins are so high—because we've set the taxes so high—that is not a deterrent; it's just a cost of doing business.

For me, the test is much simpler than the language in this bill. Can the parent in Jannali who wrote to me at the start of this bill walk through their local shopping centre and feel confident that the shops around them are operating lawfully, selling lawful products that won't be sold to their children? Can the honest small-business owner know that the government will not leave them to compete against an organised criminal network that firebombs competitors, that's committed murders—murders over a product that should be illegal—because we've stuffed up the tax, because we're taxing you too much? Not only are we taxing you at the highest rate on total income you've ever been taxed in your life or with the highest tax on capital you've ever been taxed in your life; we're taxing cigarettes at the highest rate in the world and allowing criminal operators to operate in plain sight, making superprofits, selling cigarettes to your kids, firebombing your neighbours and, in some cases, murdering the competition. That is what is going on here.

Can organised crime look at Australia and conclude that illicit tobacco is easy money that the government just turns a blind eye to? Right now, I think they look at that and they say yes—yes, they can. And constituents know that because they're living it. The message to criminal networks making superprofits from this trade should be simple: if you import it, distribute it and launder the proceeds, or knowingly sell illegal products to anyone—let alone children in my electorate—the government should use every lawful power to find you, shut your operation down, lock you up and take your illegal proceeds of crime away.

Now, yes, the coalition will support this bill, but it goes a tiny fraction of the way. The problem will not be solved; it'll be absorbed as a cost of doing business by these super criminal networks operating in our community. This is about protecting children, backing parents and honest businesses, keeping organised crime out of my electorate and keeping the kids in my electorate out of the shopfronts of organised crime. We need to restore something basic: confidence that, when Australians see the law being broken in plain sight, the Prime Minister will stand up and act.

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

I thank all members for their contributions to the debate on the Combatting Illicit Tobacco Bill 2026. The bill, to summarise, delivers on the adoption of a collective approach against illicit tobacco. It means that the penalties will reflect, properly and finally, the severity of the harm and that law enforcement agencies will have the new, consistent and expanded powers needed to target the proceeds of crime: unexplained wealth and tainted property. The reforms in this bill are essential to provide safeguards against the illicit tobacco market to ensure that the hard won gains, which have been won by Australians over a generation now, are maintained with respect to the reduction in smoking rates—and we can be proud as a country, as a society, that we now have smoking rates, in the adult population, amongst the lowest anywhere in the world—as well as community safety and economic security being bolstered.

For too long, illegal tobacco has been seen as a low-risk, high-profit activity. This bill goes a long way to reversing that equation, to raising the risks and the stakes for criminals involved in this trade and lowering their profits. It changes the risk calculus of criminal actors, by raising penalties associated with offences against importing, manufacturing, possessing, moving, buying or selling illicit tobacco under the Customs Act, the Excise Act and the Taxation Administration Act, matching the severity of the harms caused by illicit tobacco. I'm sure the member for Kooyong, sitting opposite, as a medical professional would agree that illegal tobacco is not a victimless crime.

As well as profits flowing to organised criminal syndicates, this is a worldwide problem. It's been caused by a surplus of desperately cheap global production of tobacco, often for less than a dollar a packet, that criminal syndicates have industrialised and weaponised, flooding borders of all nations with massive amounts of product.

The bill also amends the Telecommunications (Interception and Access) Act to enliven telecommunications interception powers for illegal tobacco under the Customs Act, Excise Act and TA Act. That's really important because it gives law enforcement agencies enhanced intelligence techniques, including wire taps, computer listening devices, surveillance devices and so on, to match the severity of illicit tobacco crimes.

Lastly, and importantly, the bill enhances Australia's proceeds-of-crime regime through amendments to the Proceeds of Crime Act to more effectively target the profits of serious and organised criminals engaged in the illicit tobacco trade. This is achieved through the adoption of new and expanded law enforcement powers to target proceeds, instruments and benefits of crime. Put simply, as the Australian Federal Police, the Criminal Intelligence Commission and the state and territory police forces have explained to me directly, prosecutions are important. They provide a deterrent effect and are an important accountability mechanism. But they're also slow and expensive. What really hurts criminal actors and criminal syndicates rapidly is to go after the proceeds of crime—to take their houses, their cash, their boats, their cars, their toys—with the unexplained wealth provisions.

New and expanded powers in the act include introducing a national, broad and consistent protective order power for restraining-order applications, expanding the availability of proceeds-of-crime examination orders where there is no restraining order in force or before a restraining order has been made; allowing information obtained using POCA powers to be shared with Commonwealth, state and territory agencies for regulatory purposes; introducing a person search warrant power; and modernising the existing search warrant framework to align the powers under the Crimes Act. Other POCA amendments include changes to service provisions to enable postal or electronic service; allowing jurisdictions to access the equitable sharing arrangements to encourage cross-border cooperation and better target unexplained wealth; and removing the requirement for a court to make a preliminary unexplained wealth order.

I just want to address a few of the thematic issues which were raised in some of the contributions to the debate. First, with respect to excise—and I listened carefully to the previous speaker, the member for Cook—there's a convenient fact which the opposition, who are now running this line, along with One Nation and big tobacco, seek to overlook—that excise was never about revenue. It was always designed as a pigovian tax, a tax that is actually designed to drive down consumption, to cost in the externalities—in this case, to the health system, like environmental taxes. It was always meant to go up and then go down. The smoking rates fell.

This used to be a bipartisan policy. Excise rose by over 120 per cent under the former government and has risen by around 30 per cent under our government, most of which was to deal with the post-COVID inflation spike. So, to be very clear, excise rose fundamentally under their government, a fact that they don't want to talk about.

I feel a bit sorry for them because they're supposed to be the alternative government and have a considered policy process. A few weeks ago they were talking about an excise cut that was magically going to solve this problem of 30 per cent. Then a little while ago it was 50 per cent. This morning Senator Hanson, I think, said 75 per cent, and then the opposition said 80 per cent. Next week it'll probably be 90 per cent. They found an economist who was quoted as saying, 'Wipe it out.' The week after, they'll probably be paying Australians to take up tobacco. This is not the way to do a policy process.

We should always keep an open mind, right? We should always look at the evidence. But I say to those who say that this is some kind of magic bullet, that this is a magic solution, could someone please put on the table—not just wave around numbers and run the political line of big tobacco but actually put on the table—a number, with modelling, that they think would solve the problem. The truth is you could wipe out excise, and illegal cigarettes would still be cheaper. Countries that have almost no or no excise still have an illegal tobacco market because the criminal syndicates can produce this stuff for less than a dollar a pack. That brings me to the second point; I'll just make a statement: it's not the Labor Party that takes donations from big tobacco. The same can't be said of the coalition.

My third point—and I agree with many of the contributions, those of the previous speaker and others—is that these ridiculous, sleazy illegal tobacco shops that have sprung up in every state and territory have to be closed. It's not fair to genuine retailers, be they big or small; it's not fair to those trying to make a living; and it's downright dangerous for our public health. The ubiquity of the availability of illegal product in strip shopping centres has driven Australians mad. Over 90 per cent of adult Australians do not smoke, and they don't want this stuff in every strip shopping centre and shopping mall for their kids to become hooked on.

I'll explain it like this: despite all the political theatre that we've heard too much of, nonsense that the government's doing nothing, the national disruption group set up less than a year ago is kicking goals. We saw over a hundred service stations raided last week. You've got to think about it like this: it's Commonwealth led with every state and territory police force. You've got to think about it as preborder, at the border and postborder.

Preborder, we're having record levels of disruptions. That's about deepening our intelligence partnerships with foreign governments. The best container of illegal tobacco is one that never reaches Australia. Last year there were over 30 tonnes of containers that were disrupted and never came near Australia.

At the border, Border Force have had record levels of seizures. Over a kilotonne of tobacco was seized in four months at the border. They had a record month in March, a record month in April, a record week in March, a record week in April. But no country can win this fight at the border. There's a flood of surplus, cheap, global production—less than a dollar a packet—that criminal syndicates have weaponised, and they are flooding every national border. Even Singapore, which is pretty well-known for its law and order and border control, has an illegal tobacco problem. Theirs is different. It's not shops; it's motorcycle couriers and WhatsApp.

But it's postborder where the biggest gains most urgently need to be made. The Commonwealth's now invested over the last couple of years $98 million in supporting states and territories and another $280 million or so for Commonwealth enforcement through the Federal Police, through Border Force and so on. We need the states and territories to shut the shops. To put it in the extreme again, if you wiped out all excise—imagine that world—illegal tobacco would still be cheaper. You've got to go and shut the shops. It's constitutionally not something the Commonwealth can do. I understand that some state governments are running a line. It's a good media line to avoid their own political responsibilities to shut the shops. We are supporting them in shutting the shops, but we need more urgent action.

I'll shout-out and praise Queensland. The Queensland government and the South Australian government—it shouldn't be a partisan issue—were the forerunners of adopting the toughest legal frameworks in the country: strong licensing regimes, stronger penalties, immediate suspension of licences for any legal licensed retailer found selling illegal product and, most importantly, long closure orders and landlord penalties. I spoke to a constituent at the member for Flynn's request, and we talked through this. It was the landlord penalties that the retailer in your electorate explained were having the greatest effect, and that's been shown to be the case. There's clear and emerging evidence from industry, from retailers and from intelligence sources that in Queensland, where they're doing proper enforcement, legal tobacco sales are rising. We cannot surrender this issue to organised crime. Now is the time to double down, not back down, and run big tobacco's line.

I want to address, though, a pretty appalling theme that I've heard in some of the contributions from those opposite, and that relates to vapes. The previous speaker talked in emotional terms about a mother who was worried, rightly, about her children becoming addicted to vapes and nicotine from the illegal vapes sold at the local shops. I share that concern. The price of illegal vapes has been escalating rapidly because we are seizing them at the border and shutting the shops. The price of illegal vapes in Queensland has been skyrocketing because enforcement is actually happening there.

But the hypocrisy in, on one hand, rightly observing the dangers of illegal vapes and, on the other hand, being in coalition with the National Party, which wants to let vaping rip in our society, needs to be called out. Imagine a horrible parallel alternative universe where the National Party had had their way—it's still their policy—and had legalised vapes. It'd be a far worse situation.

And I'll finish on this point. Despite everything that organised crime has been throwing at our country and countries across the world, the data that was released a few weeks ago—the gold standard data which has been credible and accepted for over 30 years—from the Australian Institute of Health and Welfare, showed that, despite all of that, smoking rates in our country have continued to fall, and vaping rates have now stabilised and flatlined. The percentage of young Australians aged between 14 and 17 who have never vaped has now increased.

These are incredibly important gains. We cannot condemn the next generation to the scourge of nicotine addiction. There are those opposite who want to run the 'big vaping' lobby's arguments that, somehow, vaping is not dangerous and should be allowed to let rip. Of course, there's a prescription vape regime, if people feel that that's a better alternative to help them quit. But the proposition that vaping should be allowed to let rip across the country is just an appalling idea for our society. I've been down to the TGA, I've met with the scientists and I've stood with them as they test this stuff. Some of the vapes can have the equivalent of nine packets of cigarettes of nicotine in them. They're unregulated. They're full of chemicals merging with heavy metals. They're not some safe alternative and they're not something which our country should cave in to big tobacco on and let rip right across the country.

So we look forward to the Senate committee's report. We consider everything with an open mind, but I encourage those opposite to regain the spirit of public health bipartisanship on this and actually come to the table with firm proposals, not random changing numbers.

Cassandra Fernando (Holt, Australian Labor Party) | Link to this | Hansard source

The original question was that this bill be now read a second time. To this the honourable member for Canning has moved an amendment that all words after 'That' be omitted with a view to substituting other words. The honourable member for Kooyong has moved an amendment to that amendment that all words after 'notes that' be omitted with a view to substituting other words. The immediate question is that the amendment moved by the honourable member for Kooyong be agreed to.

Question unresolved.

As it is necessary to resolve this question to enable further questions to be considered in relation to this bill, in accordance with standing order 195 the bill will be returned to the House for further consideration.