Australia Plans Tougher Penalties for Illicit Tobacco and Vape Crime

Key Takeaways

• Australia plans to strengthen penalties for illicit tobacco and vape-related offences and expand wiretap and asset seizure powers.
• The proposed reforms would elevate related tobacco offences to the status of “serious crimes.”
• More than half of all tobacco products sold in Australia in 2024–25 were estimated to be illegal.
• About 95.7% of e-cigarette products sold were estimated to be illegal, with a market value of about AUD 1.6 billion (approximately USD 1.088 billion, based on 1 AUD = 0.68 USD).
• Lost excise revenue from illicit tobacco sales was estimated at AUD 7.7 billion to AUD 11.8 billion (approximately USD 5.236 billion to USD 8.024 billion, based on 1 AUD = 0.68 USD).

2Firsts, March 19, 2026

According to ABC, the Australian government is preparing a new crackdown on the illicit tobacco market, including tougher penalties for illicit tobacco and vape-related offences, expanded wiretap powers, and stronger asset seizure measures aimed at organised crime networks.

Assistant Minister for Customs Julian Hill said the proposed reforms would elevate tobacco offences to the status of “serious crimes,” increase maximum jail terms to as much as two or three times current levels, and allow police to seize assets linked to criminals’ “unexplained wealth,” including cars, boats and houses.

The original report cited the 2024–25 Illicit Tobacco and E-Cigarette Commissioner’s report, which estimated that more than half of all tobacco products sold in Australia are illegal. It also said that about 95.7% of e-cigarette products sold were illegal, with a market value of about AUD 1.6 billion (approximately USD 1.088 billion, based on 1 AUD = 0.68 USD). 

During the same period, organised crime groups were estimated to have earned AUD 4.1 billion to AUD 6.9 billion in profit (approximately USD 2.788 billion to USD 4.692 billion, based on 1 AUD = 0.68 USD), while lost excise revenue was estimated at AUD 7.7 billion to AUD 11.8 billion (approximately USD 5.236 billion to USD 8.024 billion, based on 1 AUD = 0.68 USD).

The government also said that beyond border interception, future enforcement will focus on shutting illegal shopfronts, tackling online sales, and responding to the growth in illegal importation, advertising and supply of nicotine pouches. Draft legislation containing stronger laws and tougher penalties is expected to be unveiled when parliament returns next week.

Image source: Australian Border Force