Key Points
● Victoria targets illegal tobacco shops;
● Fines may exceed A$2.4 million;
● Nicotine use rose 40% since 2017;
● Black market share estimated at 80%.
2Firsts
June 4, 2026 — According to Reuters, the Australian state of Victoria introduced legislation on June 4 to give police and the state tobacco licensing regulator stronger powers to shut businesses selling illegal tobacco.
Under the proposed law, police and Victoria’s tobacco licensing regulator would be able to issue closure notices and seek court orders to shut businesses for longer periods.
Businesses that fail to comply with the orders could face fines exceeding A$2.4 million (approximately US$1.71 million) and up to 20 years in prison.
“If you are selling illicit tobacco in Victoria, we are closing the door on your business,” said Enver Erdogan, Victoria’s minister for casino, gaming and liquor regulation.
“The illicit tobacco trade puts Victorians in harm’s way. It funds organised crime and requires a coordinated effort across borders to stamp it out,” Erdogan said.
Reuters noted that Australia charges a federal tax of about A$1.50 (approximately US$1.07) on each individual cigarette to discourage smoking.
As a result, a pack of cigarettes in Australia can cost more than A$60 (approximately US$42.8).
The report said high prices have been blamed in part for fuelling a rise in illegal tobacco products.
The legislation came one day after the Australian Bureau of Statistics (ABS) released data showing that nicotine consumption across the country rose by 40% between 2017 and 2025, far outpacing population growth of 14%.
ABS said the increase was driven by rising use of illegal tobacco as well as e-cigarettes.
The bureau estimated that 80% of cigarettes and other nicotine products consumed by Australians in 2025 came from the black market.
ABS also found that prices of illegal tobacco products have remained relatively constant since December 2016, while prices for more expensive legal products have almost tripled due to annual tobacco excise increases.
Industry observers said Victoria’s stronger enforcement push reflects how Australia’s illicit tobacco market has evolved beyond tax losses into a broader issue involving retail regulation, public safety and organised crime.
Cover Image source: thewest.com.au
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