New South Wales Premier Chris Minns and other officials are criticizing the Anthony Albanese government for its failure to curb illicit tobacco trade.
The dispute highlights a growing rift within the Labor party regarding public health policy and law enforcement. Critics argue that while high taxes aim to reduce smoking, they have instead created a lucrative underground economy that undermines government regulation.
Former NSW Police Minister David Elliott said the Albanese government is "reluctant" to attack the issue of illicit tobacco [1]. This hesitation, according to critics, allows organized crime to flourish as consumers seek cheaper, untaxed alternatives to legal products.
The scale of the black market has reached critical levels in recent years. Reports indicate that four in five vapes and cigarettes consumed in Australia in 2025 were bought illicitly [2]. This represents approximately 80% of the total consumption for those products [2].
Premier Minns has broken ranks with the federal government to emphasize the urgency of the situation. The pressure from New South Wales officials focuses on the link between the high tobacco excise tax and the rise of illegal sales in cities like Sydney and Melbourne [3].
Law enforcement officials said that the current tax structure provides a direct financial incentive for smuggling and illegal distribution. They said that without a shift in federal strategy, the illicit market will continue to grow, making it harder for health authorities to track the quality and contents of the products being used by the public [3].
“The Albanese government is “reluctant” to attack the issue of illicit tobacco.”
The conflict illustrates a policy paradox where aggressive taxation intended to discourage smoking may inadvertently foster a shadow economy. If the federal government does not address the price gap between legal and illicit goods, it risks losing control over public health standards and enabling criminal networks to profit from the tobacco trade.
