Illicit tobacco moves online as organised crime tightens its grip

Last updated: 14 July 2026

Australian authorities on 14 July 2026 confronted fresh evidence that illicit tobacco is shifting from shopfronts to online stores, with cheap cigarettes ordered through websites and delivered nationwide. The change is making a violent, highly profitable black market harder to contain as Tasmania reports nearly $10 million in seizures.

The Full Story

An ABC investigation into online tobacco sales found dozens of websites advertising cheap cigarettes and vapes with delivery across Australia. In one test purchase, a carton of 10 packets cost $150, roughly one-third of the equivalent legal product. Payment was made by bank transfer, communication moved to WhatsApp, and the parcel reached the ABC’s Melbourne office within three business days using an Australia Post tracking number.

The online shift comes as police continue to battle physical retail networks. Victoria has recorded almost 200 arson attacks and six murders linked in the ABC report to competition over the illicit market. Detective Inspector Chris Murray, head of Victoria Police’s Arson Squad, said more than 500 arrests had been made over tobacco arsons, but questioned whether they had changed the market.

They [organised crime groups] have got bigger budgets than law enforcement agencies, which is just frightening.

Tasmania’s figures show how quickly enforcement activity is growing. Authorities seized 5.43 million cigarettes, 2,535 kilograms of loose tobacco and 29,899 vapes in the last financial year. The cigarette haul was five times the previous year’s total, while the vape count was nearly three times higher. New laws raise penalties, create an offence for illicit vape sales and allow businesses operating outside licensing rules to be closed.

The national argument centres on price. Tasmania’s Police Minister Felix Ellis and NSW Premier Chris Minns have called for lower tobacco excise, saying the gap between legal and illegal cigarettes feeds demand. Illicit Tobacco and E-cigarette Commissioner Amber Shuhyta says tax is only one driver and criminal suppliers could still profit after a sharp cut.

Central Figures

Amber Shuhyta coordinates the national response and says agencies are targeting shopfronts and websites. She has commissioned research into how excise changes might affect the illegal market, with findings due later in 2026.

Chris Murray leads Victoria Police’s Arson Squad. Former Australian Border Force commissioner Michael Outram argues border screening and enforcement have not clearly reduced supply. In Tasmania, Bridget Archer, Felix Ellis and Detective Inspector Troy Morrisby are backing tougher enforcement while urging Canberra to reconsider tax settings.

The Data

• 80 per cent of tobacco and nicotine products consumed in Australia in 2025 came from illicit sources, according to ABS data cited by the ABC.
• Nicotine consumption rose by almost 40 per cent between 2017 and 2025.
• The Australian Border Force seized more than 2.1 kilotons of illicit tobacco and more than 6 million illicit vapes in 2024–25.
• Outram estimated a container bought overseas for about $250,000 could generate roughly $7.5 million on Australian streets.
• Federal tobacco excise revenue is forecast at $15.4 billion from 2025–26 to 2029–30, down from an earlier $27.3 billion forecast.

What This Means

For Australians, the problem is no longer confined to a local shop selling illegal packs. Online ordering removes distance, disguises supply and lets sellers reach buyers without a visible storefront. Enforcement must now follow websites, banking trails, messaging apps and parcel networks as well as physical retailers.

The tax debate has no easy answer. Legal cigarettes reportedly sell for about $35 to $40 a packet in Tasmania, while illegal packs can cost as little as $15. Cutting excise could narrow that gap, but medical groups warn cheaper legal tobacco could lift smoking rates. Shuhyta argues organised crime can continue undercutting lawful sellers because import margins remain enormous.

The result is a three-way pressure point: smokers face high legal prices, licensed retailers lose customers, and criminal groups gain revenue. Police link that money to violence, drugs and firearms, turning a health-policy problem into a broader organised-crime challenge.

What to Expect

Tasmania’s laws are expected to receive royal assent within weeks. Authorities will then be able to close offending stores for up to 90 days and seek longer shutdowns for repeat breaches. National agencies are expected to continue website disruption, border seizures, store closures and asset confiscation.

The next major policy marker will be Shuhyta’s excise research, due for public release later in 2026. It will feed a dispute between governments, retailers and health organisations over whether enforcement, tax changes or a combined approach can reduce the black market.

Frequently Asked Questions

Why is illicit tobacco growing in Australia?

Sources point to high legal prices, cost-of-living pressure, sophisticated organised crime networks and large import profits.

Can illicit cigarettes really be bought online?

Yes. The ABC bought a carton from a website and received it at a Melbourne office through Australia Post within three business days.

How much was seized in Tasmania?

Authorities reported 5.43 million cigarettes, 2,535 kilograms of loose tobacco and 29,899 vapes, worth nearly $10 million.

Will cutting tobacco excise stop the black market?

Supporters say it could shrink the price gap. Shuhyta and medical groups argue criminals could still undercut legal sellers and cheaper cigarettes may increase smoking.

What happens next?

Tasmania is preparing to use new closure and penalty powers, while federal research on excise and illicit trade is expected later in 2026.