Customs and Other Legislation Amendment (Illicit Tobacco Enforcement Modernisation and Other Measures) Bill 2026
Ms KARA COOK (Bonner) (17:34): When most Australians hear the words 'illicit tobacco', they might picture a few cheap packets being sold under a counter, but that picture is dangerously out of date. Illicit tobacco is not a harmless cash economy. It is a sophisticated, highly profitable market, increasingly exploited by organised crime.
The people behind it are not simply avoiding tax; they are building criminal supply chains. They conceal ownership, misuse legitimate freight networks, move money through layers of people and businesses, and profit by selling an addictive and deadly product outside of every safeguard Australians expect. They do not care about public health.
They do not care who they sell to. They do not care about the legitimate small businesses they undercut. And they do not care where their profits go next.
When organised crime changes the way it operates, our laws must keep pace. That is why the Customs and Other Legislation Amendment (Illicit Tobacco Enforcement Modernisation and Other Measures) Bill 2026 matters. It strengthens our ability to stop illicit tobacco at the border, secure it while it's under customs control, seize and forfeit it efficiently, investigate those behind it, and strip away the profits that make this trade attractive.
It is practical legislation, but its purpose is very clear: to make Australia a harder place for organised crime to do business. This issue is especially relevant to communities like mine. Bonner is home to more than 14,000 businesses.
They include family-owned retailers, manufacturers, customs and freight businesses, transport operators, warehouses and logistics companies. It is also home to the Port of Brisbane, one of the most important trade gateways in our country. In 2024-25 the port handled around 1.6 million 20-foot equivalent containers, 34.9 million tonnes of trade and approximately $73.5 billion in international trade.
The port and its supply chain support around 73,000 jobs. Those figures tell us something very important: trade is not an abstract idea in Bonner. It means jobs, investment and opportunity.
It means the truck driver starting before dawn, the worker on the wharves, the customs broker checking a consignment, the small manufacturer waiting on an input, and a local business getting its product to market every day. Enormous volumes of legitimate goods move through my electorate. Overwhelmingly, the people involved in that system are doing the right thing.
They follow Australia's customs rules. They keep records. They pay their workers and their taxes.
They carry the cost of compliance because they understand that a trusted border protects us all. They deserve a level playing field. They should not be forced to compete with the black market, whose competitive advantage is breaking the law.
The most reputable businesses operating around the port should not have their industries or their community defined by criminals seeking to exploit legitimate supply chains. Strong enforcement protects the integrity of trade. It protects reputable operators, and it protects public confidence in the systems that allow goods to move efficiently into and across our country.
The scale of this problem is no longer open to any doubt. Recent operations in Queensland show both the size of the illicit market and the value of coordinated enforcement. In March this year, a multi-agency operation in North Queensland seized more than 5.89 million illicit cigarettes, more than 1.2 tonnes of loose-leaf tobacco and more than 18,800 vapes.
The combined estimated street value and duty evaded was over $12.5 million. In another Queensland operation, authorities seized more than 13.7 million illicit cigarettes, more than 380 kilos of loose-leaf tobacco and more than 27,000 vapes, dealing an estimated $23 million blow to the illegal market. And in August, the Australian Federal Police alleged that one network had used around 88 air cargo consignments, since May, to import illicit tobacco before storing it for distribution.
These are not isolated packets changing hands. They are commercial-scale operations requiring money coordination, storage, transport and distribution. That is precisely why the government established the Illicit Tobacco National Disruption Group to bring agencies together and target the mid-level criminals and enablers who import, store, move and distribute these products.
No single agency can dismantle an entire criminal business model on its own. We need intelligence shared, we need action coordinated, we need pressure applied at every point in the supply chain and we need legislation that supports that work rather than slowing it down. There is also a public health truth we cannot allow to disappear from this debate: tobacco remains the leading cause of preventable death in Australia.
Smoking takes more than 24,000 Australian lives each year. That is around 66 people every single day. My grandfather died of lung cancer, and he was a very heavy smoker throughout his life.
Australia has made extraordinary progress in reducing smoking. The latest national data show daily smoking among people aged 14 and over has fallen by more than 70 per cent since 2001. That progress is not accidental; it came from evidence based public health policy, education, plain packaging, advertising restrictions, quit support and tobacco taxes that reduce consumption, particularly among young people.
We should be proud of that progress and determined to protect it. We should also be clear that illicit tobacco threatens it. Illegal sellers do not apply health standards.
They do not respect packaging laws. They do not check whether a young customer is becoming addicted for their health and safety. Their only concern is making the sale.
The answer is not to surrender decades of public health progress by making a deadly product cheaper. The World Health Organization is clear that tobacco taxes are among the most effective ways to reduce tobacco use, especially among young people and people on lower incomes. International experience also shows that illicit trade can be confronted while strong tobacco taxes are maintained.
The responsible answer is a strong public health policy and strong enforcement operating together. We can protect Australians from tobacco related disease and target the criminals exploiting the illicit market. In fact, we must do both.
We are already seeing the results of that work in my home state of Queensland, backed by more than $18 million in Albanese Labor government funding. New data shows legal tobacco sales jumped 55 per cent following stronger enforcement measures and remained 40 to 45 per cent above previous levels six months later. Calls to Quitline have more than doubled following major enforcement operations.
That is what strong enforcement can achieve: disrupting criminal profits, supporting legitimate businesses and encouraging Australians to quit smoking. One of the weaknesses in the existing illicit tobacco framework is that parts of it were designed for a different operating environment. Under existing offence provisions, authorities can be required to prove that tobacco was imported with an intention to defraud the revenue.
That sounds straightforward on paper. In a sophisticated criminal network, it can be anything but. Organised crime deliberately creates distance between the person directing an operation and the product at the border.
Ownership is hidden, documents are manipulated and goods pass through multiple hands. Corporate structures and intermediaries are used to blur responsibility. This legislation modernises the offence framework by creating new offences covering the importation, possession and conveyance of tobacco where there is reasonable suspicion that it has been unlawfully imported or that its importation would defraud the revenue.
It also allows tobacco to be prescribed as a Tier 1 good that enables existing serious customs offence pathways to apply where tobacco is imported without the permission or approvals required by law. These changes are about closing gaps between what enforcement agencies can see and what they can prove under laws written for another time. Protecting the border does not end when a ship docks at the Port of Brisbane, when a plane lands or when a container is unloaded.
Goods may move through licensed depots and warehouses before they are lawfully released. That period of time matters. Tobacco that's technically within customs control can still be targeted for diversion into the illicit market.
The legislation therefore strengthens controls over tobacco held in licensed warehouses and introduces tobacco-related licence conditions for customs brokers, depots and warehouses authorised to handle these goods. A licence is not merely permission to operate. It carries a responsibility to protect the integrity of the system.
Where an operator is entrusted with goods under customs control, government must be able to set appropriate conditions and respond when those conditions are breached. For legitimate customs, freight and warehousing businesses in Bonner, this is fundamentally about confidence that standards apply across the industry, that bad actors cannot gain an unfair advantage and that government will act when legitimate infrastructure is misused.
The legislation also addresses a practical question: what happens after illicit tobacco is found? Enforcement does not become effective simply because goods have been located. The seizure and forfeiture process must also be fit for purpose.
Existing administrative arrangements can require significant time and resources even where the nature of the goods and the circumstances of the seizure are clear. This bill modernises notification arrangements by enabling direct, bulk and electronic notices, as well as the publication of seizure information. For specified tobacco seized under the prescribed powers, it removes the ability to make a claim for return and allows the goods to be immediately forfeited.
That means less time and public money spent processing claims that serve no legitimate purpose. It means seized products can be dealt with safely and efficiently, and it also means that our enforcement agencies can focus their people and resources on identifying networks, gathering evidence and disrupting the next shipment. Finding and confiscating the product is still only part of the task.
If we want to hurt organised crime, we must go after what organised crime cares about the most: the money. The illicit tobacco market exists because it is profitable. The product may be tobacco, but its objective, of course, is wealth.
That is why the amendments to the Proceeds of Crime Act are so important. We do not only want to intercept a consignment and leave the financial structure behind intact. We want to identify the assets, trace the proceeds and dismantle the business model.
We want the people financing and directing these networks to know that distance from the box or the warehouse will not place their profits beyond reach. Crime should never be a pathway to wealth, and no criminal enterprise should be able to treat the occasional seizure as simply a cost of doing business. The world in which these investigations occur has also changed enormously.
Once, obtaining a document meant identifying the office cabinet or archive where it was stored. Today, a document may be stored on a server on the other side of the country or the other side of the world and be accessed instantly from a laptop in Brisbane. The relevant evidence may sit across accounts, across devices and, of course, across jurisdictions.
This legislation clarifies that production orders can be sought after proceedings have commenced and removes outdated jurisdictional limitations. The bill also strengthens the consequences for destroying, defacing or interfering with documents subject to a production order because deleting evidence must not be some easy way out. A person who deliberately frustrates a lawful investigation should face consequences that reflect the seriousness of that conduct.
These reforms take a coordinated approach to tackling illicit tobacco, strengthening border offences, tightening supply chain controls, modernising seizure and forfeiture processes, and improving investigations into organised crime and its profits. Developed through a whole-of-government approach, they recognise that illicit tobacco is not just a border issue.
It is an organised crime, revenue, business integrity and public health issue. The overwhelming majority of Australian businesses do the right thing. They pay their workers, meet their obligations and contribute to their communities.
Across Bonner, I see hardworking business owners building their livelihoods and supporting our local economy. They deserve a level playing field free from unfair competition driven by illegal activity. This legislation sends a very clear message: as criminal networks adapt, so will our laws and enforcement efforts.
We will continue to back honest Australian businesses, protect our communities and ensure that organised crime has no easy path to profit. I commend the bill to the House.