Flourishing illicit tobacco trade costs the Australian economy AUS $4bn a year 

Australia's illicit tobacco trade has become one of the nation's fastest-growing criminal markets, with a cost to the economy of AUS $4 billion in the 2023-24 financial year through lost tax revenue, healthcare costs and reduced productivity. This represents a four-fold increase since 2020–21 and cements tobacco as the second-largest illicit commodity market after drugs.

Authorities stress the $4 billion figure is conservative, as it does not include illegal vapes and e-cigarettes.

Profits from Australia's illicit tobacco trade fuels violence, as organised crime syndicates recycle the proceeds into other criminal activities and has led to it becoming one of Australia’s most violent and fastest-growing criminal markets. Twin reports from the Australian Criminal Intelligence Commission (ACIC) and the Australian Institute of Criminology (AIC) reveal the economic impact of serious and organised crime jumped $13.6 billion in 12 months, fuelled by factors such as soaring black-market tobacco sales and increasingly brazen violence linked to turf wars.

Speaking in Canberra, early November 2025, the ACIC chief executive Heather Cook said organised crime groups were waging violent battles for control of the lucrative tobacco and vaping trade. She said the ACIC had linked criminal syndicates to more than 200 firebombings and at least three homicides, including one of an innocent bystander, since 2023, as well as widespread instances of extortion and intimidation.

"Billions of dollars in lost tax revenue means less money for hospitals, schools and essential services," Ms Cook said.

The Duty Free World Council fully supports all efforts to eliminate Illicit trade and encourages governments across the world to devote time and resources to crack down on the major sources of illicit trade in tobacco products by closing down illicit production facilities and stopping cross border smuggling by criminal gangs.

View a recent report on the illicit trade in tobacco products in Australia by Australia’s ABC News ABC Australia News Report in Illicit Tobacco Trade