MATTERS OF PUBLIC IMPORTANCE
Mr HASTIE (Canning) (15:12): Australia's tobacco wars are causing a national organised-crime crisis. We got a reminder of that this morning at 3.15 am, in the Melbourne suburb of Sunshine, where police are now investigating a suspicious fire at a tobacco store in Sunshine; we got a release from the Victorian police at 5.10 am. This is just another firebombing—after we've already seen 200 firebombings in Victoria, and six murders.
Over the last two days, in question time, we've asked the Prime Minister four times about Australia's tobacco wars and the organised-crime crisis that it's creating. And what has he done? He has not answered the question once.
Who has he deferred to? He has deferred to his three leadership rivals—the minister for health, the Minister for Home Affairs and the Treasurer. Rather than answering the question, he's deferring to his leadership rivals and ignoring the problem facing Australians across this country.
What are we actually looking at here? Well, we've seen it in communities across this country. We've seen the empty convenience stores, with shelves stocked with lollies and confectionery and gum, and not many people, but fortified with steel doors.
And next to them, quite often, you'll see illegal brothels masquerading as massage parlours. But what we are seeing is a thriving illicit tobacco trade. From Mandurah to Melbourne, from Darwin to Adelaide, Australia's illicit tobacco market has become a serious organised-crime problem, and legitimate small businesses are now struggling to compete with highly-organised criminal enterprises with global supply chains.
We see the shopfronts in our community, but the supply chains reach back to China, the UAE, Singapore and Hong Kong, who act as supporting logistic nodes. And this Labor government is losing the battle against illicit tobacco. It's a weak Labor government.
It's weak on borders, it's weak on crime and it's weak on health policy as smoking rates increase in this country. So, what does this mean? Well, business is booming for criminals in this country.
The Australian Bureau of Statistics estimates that 80 per cent of tobacco consumed in Australia last year was illegal. The government's own Illicit Tobacco and E-Cigarette Commissioner has estimated the illicit tobacco market to be worth between $4.1 billion and $6.9 billion annually. At the same time, tobacco excise revenue has fallen from around $16 billion in 2019-20 to around $8 billion this year.
Our budget has taken a massive hit under the negligence of the Albanese Labor government. The government keeps taxing smokers harder while collecting less revenue, and it's forcing working Australians who choose to smoke—I don't recommend it, but there are Australians who smoke—onto illegal, black markets. As those Australians move to the black market, billions of dollars are flowing into the hands of organised crime syndicates, and those profits are funding drugs, scams, money laundering and violence.
The ratlines that the illicit tobacco industry have created through our borders are also being used to run guns and fund drugs, terrorism and other illegal activities. In Victoria alone, as I said, we've seen more than 200 tobacco related instances of arson and six murders—six murders linked to the trade. In Sydney, gang related violence is also on the rise.
We've seen shootings, kidnappings and other violence, including in cases of mistaken identity. Innocent Australians are being harmed by this illicit tobacco trade, and something needs to be done. This is no longer about isolated incidents.
This is a scaled criminal enterprise that is controlling our borders and damaging our local communities. So why is this happening? It's not a coincidence.
It's a direct result of the Albanese government's tobacco excise increases and their failure to protect our borders and enforce the law with the criminal networks who run the illicit tobacco trade. In 2023, Labor added a five per cent annual increase to an already indexed tobacco excise. They failed to foresee the consequences and have failed to respond, as the Prime Minister has failed to respond in question time these last two days.
It's now become a lucrative criminal enterprise. This is what happens when your tax settings get so ridiculous—when you allow public health zealots to tax an industry to the point that people have no alternative but to go to the black market to purchase tobacco related goods. The price gap between legal and illegal tobacco has become enormous.
A legal packet of cigarettes costs around $50, with more than $30 of that coming from the tobacco excise. Illegal packets, by contrast, are selling for between $15 and $20. Australians who continue to smoke are being given a huge financial incentive to buy illegally, and criminals have stepped in to meet that demand.
No matter how expensive tobacco becomes, there will always be Australians who choose to smoke. There is no political utopia where smoking does not exist; we on this side are realistic. I don't recommend it.
There are all sorts of complications that come from smoking: lung cancer, emphysema, mouth cancer, tongue cancer, heart disease—and death. Please, I recommend you not smoke. But there will always be people who smoke, and it's those who are already being punished by Labor's cost-of-living crisis, by inflation and by flatlining real incomes who are forced to buy cigarettes and other tobacco related goods from the illicit tobacco market.
There's a choice here. The choice is simple. Do we have a tobacco industry governed by the Commonwealth, where products are regulated, businesses operate legally and taxes are collected?
That's what we believe should be the reality. Or do we have a tobacco industry governed by international criminal networks that run illicit cigarettes, drugs, firebombings and terrorism and make Australia unsafe? That's the choice.
We want to take on the criminal networks. We want to drop the excise. On that side, they don't want to hear or see anything to do with the illicit tobacco trade.
It's just too hard. That's what happens when you have a weak prime minister. That's what happens when you have a weak government presiding over our borders and not enforcing the law.
Even the New South Wales premier has called on the Prime Minister to cut the excise, saying the current policy isn't working. Chris Minns, the New South Wales premier, is spot on, and I will quote him here now: … I think it's perversely driving a situation where you're seeing more people not less people smoking because they've got access to readily available cheap cigarettes.
This government, in its weakness, is forcing working Australians into a black market that is funding all sorts of criminal activity in this country, and we in the coalition want to see an end to that. So what's our plan? Our plan is to tackle this problem head on.
Under the Leader of the Opposition, we are going to take down these tobacco criminal syndicates. We will cut the tobacco excise by 80 per cent, and we will strengthen law enforcement—cut the excise and hit those criminal networks hard with the full force of Australian law. Our plan will see the excise component of a standard packet of 20 cigarettes fall from around $30 to $6.
That's the point at which you start destroying the black market. You've got to be active here. You've got to take these guys head on, and we're going to do it by cutting the excise and disrupting and crushing their illicit tobacco market.
This will dramatically reduce the price advantage enjoyed by criminals. Right now, the government has created a black market where a smoker can buy an illegal packet for less than half the price of a legal packet. That's the business model that organised crime is exploiting, and under our leader we intend to break it.
We will not be weak like the Labor government. It's not just about excise, though. The coalition's plan will be backed by $200 million, with a nationwide law enforcement surge.
We're going to get all elements of law enforcement onto this, and we're going to push them hard to break apart these criminal syndicates. It's pretty straightforward. It requires tough political leadership.
That's what you'll get with the Leader of the Opposition. On the other side, you have a weak prime minister who won't even answer questions about this. We will increase raids, arrests and seizures; shut illegal shops; stop shipments at the border; and follow the money through the AFP, Border Force, ASIC and AUSTRAC.
We're going to come after the economics of the black market and the illicit trade, and we're going to hit them hard with law enforcement—stronger enforcement that goes after the criminals who remain. But we're also realistic. We're also going to legalise, regulate and tax vapes and nicotine pouches for adults, overturning Labor's ban and bringing these products under Australian regulation.
We're not going to be captive to public health zealots. We live in the world of realism, and there are Australians out there who, for whatever reason, choose to buy tobacco products. Well, we want them doing it under the law, not under a criminal syndicate.
That's our plan. It's going to work—strength, weakness, strength, weakness.