Illicit tobacco trade causes business closures and major revenue losses in Australia

The illicit tobacco and vaping market is causing significant economic disruption for retailers across Australia. In Orange, New South Wales, NSW Health inspectors issued short-term closure orders to three businesses on Summer Street: Elite Tobacconist & Newsagency, Best Orange Tobacco Gifts and Convenience, and Central West Tobacconist. The closures, effective until December 6, are part of a crackdown on the sale of illicit tobacco, vaping goods, or unlicensed smoking products.

In Tasmania, independent supermarket owners report severe financial losses attributed to the booming black market. IGA co-operative owners in Launceston, including David Baxter and Craig Redman, have reported revenue declines totaling millions of dollars. Baxter noted that his Prospect store alone saw approximately $2.5 million in losses over a year, while Redman reported a $2 million drop in the last 18 months. These owners highlighted a ‘basket effect,’ where the loss of tobacco sales leads to a decline in overall store revenue as customers stop making impulse purchases during their visits.