Australia’s illicit tobacco market drives organised‑crime growth

A Senate inquiry into Australia’s tobacco crisis revealed that roughly 65 % of cigarette sales are now on the black market – up from 16 % in 2020 – after a near‑tripling of excise duties over the past decade. The Illicit Tobacco and E‑Cigarette Commissioner estimates that $11.8 billion in excise revenue was lost last year, with the proceeds flowing to organised‑crime groups rather than government services.

Industry executives warned that the legal supply could disappear by 2030, with a report commissioned by Oxford Economics projecting that organised crime could control up to 90 % of total tobacco consumption by 2028‑29 if current policies remain unchanged. Stakeholders are debating whether to cut excise rates to pre‑2019 levels, a proposal opposed by health advocates who argue that lower taxes would not curb smoking.

The inquiry highlighted the rapid collapse of legal sales and the difficulty regulators face in curbing illicit trade, underscoring a potential future where the nicotine market is dominated by criminal networks.