Dodgy tobacco stores in sights but no ‘silver bullet’
Industry figures have backed state legislation to end the long-running tobacco war, as the federal government faces renewed anger for fueling the black market.
Victoria inspectors and police will have the power to immediately issue up to 90-day closure orders to shops caught selling illegal tobacco, the state Labor government said on Sunday.
According to the law that will be presented to the parliament in 2026, courts will be able to order indefinite closure and inspectors will have the authority to destroy smuggled tobacco seized before the trial.
Landlords would also be able to voluntarily terminate their leases and face penalties for knowingly renting their stores to dangerous operators.
Minister of Casino, Gambling and Liquor Regulation Enver Erdogan said the proposed laws would be an additional tool to crack down on the illicit tobacco market.
“We recognize that this is not a magic solution,” he told reporters.
“There are multiple factors driving the growth of illicit trade but this will mean there is greater authority to take effective action.”
Tobacco was not regulated in Victoria until the licensing plan was introduced in February.
Victoria’s 14 tobacco licensing inspectors found a “high level” of non-compliance after visiting 49 stores in the first month the ban came into force.
More than $5 million worth of illegal tobacco products were seized, including 3.19 million cigarettes.
Mr Erdogan said Victoria was watching the introduction of similar lockdown laws across the country and his model would be tougher than any other jurisdiction.
Nearly 200 illegal tobacco shops in Queensland were temporarily closed in a 10-day blitz after similar laws came into force in November.
IGA Ritchies CEO Fred Harrison admitted he wished Victoria had taken action earlier but said sales of legal tobacco in Queensland stores had since picked up.
“There are so many undesirable things in this tobacco industry,” he said.
The Australian Convenience Store Association said the model was working in Queensland, NSW and South Australia.
But the association’s chief executive, Theo Foukkare, said states and territories were doing the heavy lifting with little support from the federal government.
“The only real way to tackle this problem head-on and destroy illicit market demand is to reduce the excise tax on regulated, legal tobacco,” he said.
“This is a failure of the federal government in every respect.”
A jump in the federal tobacco tax to $1.50 per cigarette has caused many of the nation’s 1.7 million daily smokers to turn to cheaper options on the burgeoning black market.
A threefold increase in the rate of consumption over the past decade has pushed the average price of a pack of legal cigarettes towards $50, while the price of the black market equivalent can fall below $15.
This led to 200 firebombings, at least three murders and countless acts of intimidation and extortion, according to the Australian Criminal Intelligence Commission.
Liberal Party Deputy Leader David Southwick said the proposed Victorian laws were an admission that the state government had failed in its initial response to the crisis.
“Why has it taken this government so long to act?” he said.
