Albanese government launches huge crackdown on illegal ‘chop shop’ tobacco
The Albanese government is introducing legislation to federal parliament that will overhaul Australian customs rules to make it easier to seize illegal "chop shop" tobacco. Previously, authorities had to prove illicit tobacco was knowingly imported illegally, but the new laws will allow charges based on factors such as cigarettes being sold below the cost of excise and GST, unusual packaging, or concealment, giving Border Force and state and territory police stronger powers to pursue organised crime groups behind the trade.
The reform comes amid growing political pressure over the illicit tobacco market, with the Coalition pledging an 80 per cent cut to tobacco excise and One Nation proposing a 75 per cent cut, in efforts to undercut the black market. According to the Australian Bureau of Statistics, around 80 per cent of tobacco consumed in 2025 was illegal, up from just 12 per cent in 2017, while the excise has more than tripled and risen 34 per cent since Labor took office in 2022 — a rise critics link to a wave of fire bombings targeting tobacco and vape retailers. Prime Minister Anthony Albanese has left open the possibility of cutting the excise but stressed states must also crack down on shops selling illegal products, while Assistant Customs Minister Julian Hill said the new powers would target criminals' assets, including cash, houses, cars and boats.
- New customs laws will make it easier to seize illegal tobacco
- 80% of tobacco consumed in 2025 estimated to be illegal, up from 12% in 2017
- Coalition and One Nation push for major cuts to tobacco excise
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The Australian Government imports tobacco control policy that has raised excise taxes sharply since 2022, aiming to reduce smoking by making cigarettes more expensive. This has coincided with a rapid growth in the illegal tobacco trade, with unlicensed "chop shops" selling untaxed cigarettes far below the legal price, and organised crime groups increasingly involved in importing and distributing them.
The scale of the problem has become a major point of contention in federal politics. Official figures suggest illegal tobacco now makes up the large majority of what is smoked in Australia, a sharp rise from less than a decade ago, and the trade has been linked to a spate of firebombings at tobacco and vape shops around the country.
The government, opposition parties and minor parties disagree on how to respond, with some arguing for cutting the tobacco excise to undercut the black market, while the government has focused on strengthening police and Border Force powers to seize illegal products and pursue the criminal networks behind them. State and territory authorities are also involved, since they regulate the retail shops where much illegal tobacco is sold.