Australia battling boom in illicit tobacco market and gang violence

Govt’s high taxes on cigarettes seen to be fuelling trade led by organised crime gangs

- Jonathan Pearlman For The Straits Times

Australian police detaining the alleged ringleader of a criminal syndicate accused of supplying Melbourne with more than seven tonnes of illicit tobacco. A report released on Nov 7 found that Australia's illegal tobacco trade was worth an estimated A$4 billion (S$3.4 billion) in 2024.

(PHOTO: AUSTRALIAN FEDERAL POLICE/FACEBOOK)

Australia’s heavy taxes on tobacco have left it with the world’s most expensive cigarettes, but the high prices are believed to be fuelling a dangerous illicit market that has led to growing violence involving organised crime gangs.

A report released on Nov 7 by the Australian Criminal Intelligence Commission (ACIC) and the Australian Institute of Criminology (AIC) found that Australia’s illegal tobacco trade was worth an estimated A$4 billion (S$3.4 billion) in 2024, up from A$1 billion in 2021.

The report said the trade had resulted in a “significant increase in violence”, including territorial disputes among organised crime syndicates that have resulted in murders, kidnappings, assaults, robberies and extortion of stores that refuse to sell the gangs’ products.

More than 200 arson attacks involving attacks by gangs against rival stores or houses selling illegal tobacco were recorded in the two years to January 2025.

“An extremely lucrative market for illicit tobacco products (including vapes) in Australia has rapidly grown in recent years,” the report said.

“With vast profits to be made, multiple serious and organised crime groups have become involved.”

The dramatic spike has been credited by some analysts to hefty increases in tobacco taxes, which have led to a lucrative black market, including the establishment of thousands of illegal stores across the country.