Combatting Illicit Tobacco Bill 2026

Mr GREGG (Deakin) (17:46): I rise to support the Combatting Illicit Tobacco Bill 2026. I think every member of this chamber has seen evidence of the rapidly increasing illicit tobacco market in our communities—dodgy-looking candy stores. There's one in my area where half the shelves are filled with aluminium barbecue trays, as if that's the centre of the business.

We all know where they are; we all know what they do. It's created a sense of lawlessness and an undermining of respect for the law that cannot be tolerated any longer. It's been a problem that's been rising for a long time.

While some will try to counter it in partisan terms, it's worth remembering that the Illicit Tobacco Taskforce, which was set up back in 2018, was during the coalition government, and then there was a Senate report in I think around 2020. That's not to say that it's the coalition's fault or Labor's fault. This is something that's been coming for a while.

But, as other colleagues in this House have spoken about, the risk-reward ratio for selling illicit tobacco has made it all too tempting for criminal enterprises, which deal this substance much as they do other illicit substances: creating supply chains, exploiting vulnerabilities in our system and chasing the money where it lies. So the important thing with this legislation is that it helps to change that risk-reward ratio.

It makes very clear that this is a serious offence. Its connection to serious crime itself means that the gravity of this offence gives it a serious aspect, and it needs to be treated as such. We know the industries that are driving this.

We know that serious organised crime is involved and that it is doing real harm in our communities. We've seen businesses that are completely uninvolved in tobacco face far higher costs because their strata fees have been increased by insurance costs, driven by risks associated with having tobacco retailers nearby, both legal and unlawful. So this is having a real impact on our communities.

It's having a real impact on our local economies. And it's something that all of us in the community see as this shameless, open lawlessness that needs to be dealt with in a clear and decisive way. We've seen in jurisdictions like South Australia and Queensland that where we have clear laws and we go ahead and enforce them it is incredibly effective in combating the many mischiefs associated with this market.

This bill is a further investment, a further step to ensure that we have clear and strong laws that can be enforced by our officials across the country to ensure that there is a consistent approach and that the severity of the impact of this illicit trade is reflected in the seriousness of the crimes as recorded in legislation. While it is around excise and revenue raising, to me that's incidental.

It is about the safety of our communities, it's about the rule of law, it's about combating serious crime in a real and serious way, and it's about ensuring that ill-gotten gains are recovered and treated for what they are and that there is nothing to be gained from selling illicit tobacco at any level. We have to be clear, strong and decisive. I, as much as anyone, get frustrated when I see consumer affairs or council employees politely knocking on the doors of these retailers.

I also want to see police kicking down those doors—simultaneously with other venues, because we all know they text each other and know what's going on. We need strong law enforcement around this, and that will be supported by having strong laws made in this parliament that will apply across Australia to ensure that those tools are available to our law enforcement agencies.

As part of that, the tools include surveillance provisions enabling us to detect, disrupt and respond to acts involved in this supply chain to ensure that we're actually disrupting this illicit trade and that there is no profit to be gained from engaging in this industry. It's hurting people, including our most vulnerable, in areas where people haven't got a lot of spare money and whose access to supports is minimal.

We're not dealing with honest actors here; we are dealing with crooks. We are dealing with bikie gangs. We are dealing with some of the most serious criminals in the country who have found very attractive trade for themselves.

And, generally, it's not the only stuff they're selling. They're involved in all sorts of illicit trades. This is one that they've found to be rather profitable, because it's a highly addictive substance, it's cheap to purchase, they've found various ways to get it into the market and there is demand.

Excise is a policy that's existed for a long time. It's been one of the great successes. I know that some are arguing that those excises should be cut in order to support the legal trade in tobacco.

If there is one industry that I don't support—in addition to the criminal industry—it would be the tobacco industry. These have not been honest brokers. These are a lot of the same folks that said: 'Don't worry; vaping will be the solution to smoking.

That will help us get over these addictions.' We all know that's a load of crud. The reality is that these are self-interested companies. They have been in the industry of death for decades, and I don't think I've ever seen that industry on the side of the angels on any topic.

So I think we need to view any remarks backed by industry with a healthy degree of scepticism. While I'm not here to bag local retailers, we've got to remember the history of this industry. It's one whose messages should be taken with a grain of salt, particularly when those remarks happen to align with self-interest on their part.

But I think, as a starting point, there is nothing wrong with saying that we should enforce the law. The laws should be strong, they should be consistent and they should be applied without fear or favour. We need to ensure that people understand that there are consequences.

This goes to deterrence, both general and specific, in that, when a sentence is handed down, anyone thinking of getting involved in that kind of activity realises that it's not going to be on and that engaging in that industry is not going to be conducive to a long, happy and prosperous life. It's also about dealing with individuals to make clear that this is simply not acceptable to society, because this industry has got to a point where we can no longer afford to tolerate it.

The harm that it is causing is real. It's beyond economic, and it's beyond budgetary. It goes to the rule of law.

It goes to the safety of members of our community. It goes to the affordability of conducting legitimate retail business and to making sure that our communities remain safe spaces as much as possible. It's particularly exploitative.

It's targeting our most vulnerable: those who have financial constraints. Rather than having the supports out there to help them deal with their addiction or the disincentives that have historically, for years and years and years, driven reductions in smoking rates, they've been undermined by the creation of this industry. We cannot let it continue to fester and to go through our communities without any response.

We've seen what's possible in multiple states. When we go ahead and take a hardline approach to these things, it is successful. We've got to make sure that our authorities are supported with strong laws so they're not looking for other breaches and things like that—that the laws around the possession and transportation of these substances are, in themselves, treated as serious offences and managed as such.

That is an incredibly important development. We've seen the value of this trade estimated at between $4.1 billion and $6.9 billion in 2024-25. Organised crime groups are making profits of $4 billion to $7 billion in a year.

You can see why the temptation is there. So we know what the drivers of it are; what are the restraints? Well, that has to be strong laws.

It has to be strong enforcement and ensuring that those disincentives are there, because we as a community cannot afford to tolerate it. We're going to rebalance that risk-reward calculation by ensuring that strong penalties are on the books and also that they are known and that they are enforced in a clear and public way. There will be a role for the media, a role for state governments and a role for ourselves to play in ensuring that this works, because there's no point having strong laws and court decisions that no-one hears about.

We've got to ensure that the strength of these laws is promoted and understood and that we have a very clear, and hopefully united, message to the illicit trade that their conduct cannot and will not be tolerated by this parliament or by the authorities in Australia. Since 2023-24, we've provided around $346 million in funding for Border Force to crack down on illicit tobacco and vaping products.

We know that they're catching a lot of them on the border, but we also know that that, in and of itself, will not work. It happens through post. It happens through a variety of means, and not every shipping container can be checked.

We've also got to ensure that there are systems on the ground disrupting every aspect of the supply chain—the warehousing, the transport—and, if it gets into a shop, getting in on the ground and taking care of that quickly as well. It is going to have to be complemented by reforms at state levels, reflecting those in South Australia and Queensland that deal with leases and things on the ground.

This is part of the solution but not the entire solution. I think it is important that we all acknowledge that this isn't a package that will get the job done by itself, but it is an important piece of the puzzle. It would be a great shame if anyone in this chamber voted against it simply because it is not a package that gets the whole job done itself.

This is going to be a partnership with state government. There's even going to be some roles for local council, local government and communities in making sure that we are holding these crooks to account because they are exploitative, they are criminal and they are undermining not only the safety and wellbeing of our community but also the lives of many of our most vulnerable citizens.

These are not healthy products. They're not regulated. There have been lots of reports of dodgy packaging allowing bacteria and mould, so these cigarettes can be even more deadly than the ones sold at the corner store.

We cannot show any tolerance for this stuff. But, at the same time, the solution is not to go back to the old days and say, 'Well, let's just go back to legal cigarettes.' Actually, smoking itself is a huge public health problem. It needs to be resolved.

Let's at least try enforcing the law strongly rather than just kowtowing to industry calls for bringing back legal cigarettes by making them cheaper again. I think that would be a huge drive backwards. It would completely send the wrong message to our communities.

Let's, as a first step, make sure we've got a clear and comprehensive regime to deal with the illegal behaviour and show that strong, zero-tolerance approach to it. That will involve licensing regimes. It will ensure accountability.

It will ensure that we know exactly who is registered and lawfully able to trade in legal tobacco products without allowing every shyster who can get themselves a retail lease to get involved in this illicit trade. I receive quite a lot of emails from people in my community—and it's happened since I was first elected—who are genuinely concerned about the presence of unlawful tobacco businesses in our area.

They know that it has a huge impact on the amenity of the neighbourhood. They know it has an impact on the businesses that are just going about their day to day—the local butcher, the local pharmacist, the local bakery—because all of them are going to face higher strata fees through insurance premiums, which makes the cost of business higher and makes them even less sustainable, particularly when times are already tough.

Then they've got rapidly increasing insurance costs on top of that. This is driving legitimate businesses way out of this industry towards the brink because the increase in insurance premiums can be quite dramatic in some of these strata organisations. Often it is a collective insurance policy that covers multiple businesses, so people who are doing the right thing all the time, have done nothing wrong and aren't in control of the situation are facing the costs and consequences of this illicit trade.

Every avenue that we can pursue to take down these crooks is going to have to be pursued. I commend the South Australian and Queensland governments for showing that it can be done and that a strong, firm hand, when it comes to dealing with these crooks, actually does work. But we have to have the commitment, and the supports obviously need to be offered at all levels to ensure that that is possible.

We as a government remain committed to working with our state and territory partners to tackle this illicit trade, so I commend this bill to the House.