Australia Cracks Down on Illicit Tobacco Trade as Organised Crimes Spike

$28 Million Illegal Tobacco Bust: A Game Changer in Australia’s War Against Organised Crime

Australia’s crackdown on illicit tobacco farming is intensifying, reflecting growing concerns over its links to organised crime. In a recent landmark operation, around 16 tonnes of illegally grown tobacco estimated to be worth over $28 million were destroyed in Murga. This operation, one of the largest police busts in New South Wales (NSW) history, was the result of a joint investigation by the Australian Taxation Office (ATO) and NSW Police launched last year.

Australia Cracks Down on Illicit Tobacco Trade

Tobacco Farms: The New Cash Cow for Organised Crime

Detective Superintendent Stuart Cadden noted that this operation would disrupt the supply chain of the syndicates involved, thereby curtailing their profits and reducing funding for organised crime.

“Profits from this illicit trade are often funnelled into various forms of illegal activities,” Cadden said. He also reaffirmed the law enforcement agencies’ commitment to target any criminal activity potentially harming the community.

The Growing Concern of Illicit Tobacco Farming

Despite this recent success, illicit tobacco farming in Australia continues to pose significant challenges. Australian Border Force (ABF) Superintendent Sasha Barclay noted an increasing trend of criminal syndicates turning to tobacco cultivation. The objective is clear – to maintain supply as authorities step up efforts to seize illegal tobacco at the borders.

ATO Assistant Commissioner Justin Clarke highlighted the threat such criminals pose to Australian society, emphasising that these operations were not run by genuine farmers or landowners, but criminals within local communities. “Evading excise duty on tobacco costs the community millions that could be spent on essential community services,” Clarke warned.

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Australia’s Legal Battle Against Illicit Tobacco Trade

The Escalation of Illicit Tobacco Trading

In the last year alone, the ABF detected 878.8 tonnes of undeclared loose-leaf tobacco and 712.7 million undeclared cigarette sticks. This represents a staggering 45 per cent increase on the previous year, demonstrating how attractive the illicit tobacco farming business is to criminal groups due to its high profitability.

A media release by the Australian Criminal Intelligence Commission (ACIC) revealed that organised criminals could make a substantial profit from just one container full of cigarettes, making it a lucrative enterprise with a favourable risk-reward payoff.

Law and Penalties for Illicit Tobacco Trade

The Australian government has enacted several laws to combat the illicit tobacco trade. Engaging in such illegal activities, including the unlicensed production of tobacco or manufacturing tobacco products, is considered a grave offence.

In 2018, the Australian Parliament passed the Treasury Laws Amendment (Illicit Tobacco Offences) Bill, introducing new offences and penalties for those involved in illicit tobacco trade. Penalties for possessing, selling, or manufacturing illicit tobacco can range from significant fines to prison sentences of up to 10 years.

The Customs Amendment (Illicit Tobacco Offences) Bill 2018, passed concurrently, created a regime targeting the importation, possession, purchase, sale and production of illicit tobacco. It gave the ABF the power to investigate offences where the origin of the illicit tobacco is unknown, thus further bolstering the prosecution of illicit tobacco offences.

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The enforcement of these laws provides agencies with the resources to detect, seize, and prosecute those involved in this damaging illegal trade, sending a clear message: Australia’s war on illicit tobacco trade and organised crime is far from over.

The Economic Impact of the Illicit Tobacco Trade

A Financial Drain on the Economy

The illegal tobacco trade doesn’t only fuel organised crime; it also takes a considerable toll on the Australian economy. By avoiding excise duty, these criminal syndicates rob the community of significant potential revenue. Money gained from taxes on legal tobacco sales could be used for various community services, and its loss places an unnecessary burden on taxpayers.

The Ripple Effect on Legitimate Businesses

The illegal tobacco trade also creates an unlevel playing field for legitimate businesses that adhere to the law and pay their taxes. This undercuts their competitiveness and viability, thus affecting the health of the broader business environment in Australia.

Public Health and the Illicit Tobacco Trade

Low Prices, High Consumption

The availability of cheap, untaxed tobacco products encourages consumption, particularly among young people and those on low incomes. This increased usage leads to higher rates of tobacco-related diseases, which places additional strain on Australia’s healthcare system.

No Quality Control in Illicit Trade

Illicit tobacco products are not subject to the same quality control measures as legitimate products. This lack of regulation raises concerns about what users are actually consuming and the potential health risks.

Conclusion: A Unified Stand Against the Illicit Tobacco Trade

The battle against the illicit tobacco trade and organised crime in Australia requires a multi-faceted approach. Law enforcement agencies need to continue working together to crack down on these operations, seizing illicit products and prosecuting those responsible. Businesses, consumers, and the general public also have a role to play in this fight. By choosing not to support the illegal tobacco trade, consumers can help starve organised crime groups of their revenue.

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Is growing tobacco illegal in Australia?

Yes, it is illegal to grow tobacco in Australia without a license. The unlicensed production of tobacco plant or leaf and manufacture of tobacco products is a serious offence under Australian law.

What are the penalties for involvement in the illicit tobacco trade in Australia?

Penalties for involvement in the illicit tobacco trade can range from significant fines to prison sentences. For instance, possessing 5 kilograms or more of illicit tobacco could result in a prison sentence of up to 5 years or a fine between $55,000 and $275,000, or both. Manufacturing or producing illicit tobacco could lead to a prison sentence of up to 10 years or a fine between $137,500 and $412,500, or both.

What is being done to combat the illicit tobacco trade in Australia?

Australia has introduced several laws to fight against the illicit tobacco trade, and law enforcement agencies actively enforce these laws to detect, seize, and prosecute those involved in the trade. The Australian government is also collaborating with different agencies to ensure a unified approach against this illegal trade.

Why is the illicit tobacco trade a problem?

Apart from funding organised crime, the illicit tobacco trade also undermines the economy by avoiding excise duties, affects legitimate businesses, and poses a public health risk. The availability of cheap, untaxed tobacco products encourages higher consumption, leading to more tobacco-related diseases, and these products lack the quality controls of legitimate ones.