Canberra is finally starting to crack down on the illegal street level retail trade in tobacco products.
The biggest change would mean people buying these products face prison time along with the traffickers and sellers.
New legislation proposing tougher penalties — up to five years in prison for possessing, buying or selling illicit tobacco and 10 years for manufacturing illicit tobacco — passed the Lower House last week and will now be reviewed by the Senate.
The retailing of illegal tobacco accounts for nearly 14 per cent of the total tobacco market in Australia, according to KPMG.
Police raided an illegal outlet in Seymour in January but the shop was back in business less than a week later — and still is.
Revenue and Financial Services Minister Kelly O’Dwyer said the government was committed to stopping the illegal tobacco trade.
‘‘This measure will ensure that tobacco products imported and consumed domestically are fully taxed and comply with Australian regulations,’’ Ms O’Dwyer said.
Member for McEwen Rob Mitchell said while he supported the government’s move to improve health outcomes for Australians by increasing tobacco excise, more work still needed to be done.
‘‘If the Coalition was truly committed to cracking down on illicit tobacco, they would fund the Australian Border Force’s Tobacco Strike Team beyond June 30 this year,’’ he said.
Member for Hughes Craig Kelly said prohibitively expensive cigarettes in Australia had created a black market demand for illicit tobacco.
‘‘We know the illegal activities are going to ramp up every time we ratchet the duties up and the excises. Every time lawful cigarettes become more expensive there’ll be greater and greater black market activity,’’ he said.
‘‘We have to respond and put the appropriate resources into law enforcement to making sure that they have the resources that they need and also making sure that the penalties are appropriate.’’
Australasian Association of Convenience Stores chief executive officer Jeff Rogut welcomed the proposal and said it was high time illicit tobacco was addressed in an appropriately serious manner.
‘‘Convenience store owners and staff know firsthand the impact excise increases and regulations such as plain packaging have had on the market for illegal cigarettes,’’ Mr Rogut said.
‘‘The regulatory environment for legal tobacco in Australia has made us one of the world’s most lucrative markets for organised criminals involved in the illicit tobacco trade,’’ he said.
‘‘It’s encouraging the enormity of this problem is now being acknowledged.’’