Combatting Illicit Tobacco Bill 2026
Mr HILL (Bruce—Assistant Minister for Citizenship, Customs and Multicultural Affairs and Assistant Minister for International Education) (12:28): 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. The DEPUTY SPEAKER ( Ms Fernando ): 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.
The DEPUTY SPEAKER: 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.