Combatting Illicit Tobacco Bill 2026

Ms STEGGALL (Warringah) (11:17): 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.