Ladies and gentlemen:
Our country and way of life is changing in a worrying and unpleasant way.
In the last four years, there have been almost daily reminders of a country beset by troubles.
Home invasions. Knife attacks. Shopping centre brawls.
Shops ram-raided. Businesses torched. Synagogues firebombed.
Gangland shootings.
Corruption in the building sector. In the CFMEU. In the NDIS.
Antisemitic marches.
Attacks perpetrated by Islamic extremists.
Awash with so many troubles, Australia is no longer the country we once knew.
But it’s worse than that.
In decades gone by, any one of the incidents I mentioned would have shocked Australians.
Today, so many Australians don’t blink an eye.
It’s almost as if we’ve become desensitised.
Crime, corruption, and intimidation are now so prevalent, they’ve become normalised.
Amid all this chaos, Australians are asking a simple question:
Where is the national leadership?
The Prime Minister is nowhere to be seen.
A FAILURE OF NATIONAL LEADERSHIP
Just as the Albanese government has resigned itself to managing economic decline, it’s also resigned itself to accepting a decline in law and order that’s undermining our way of life.
Of course, the federal government will say many of these law-and-order issues are matters for the states and territories.
But the crime, corruption, and intimidation we’re seeing isn’t confined to a single state or territory.
They’re national issues.
In this environment, national leadership matters.
A prime minister must lead and set the tone.
He must offer assistance and federal resources to states and territories, when they’re needed.
And when there’s enduring troubles in the states and territories, he must put pressure on their leaders to get their houses in order.
Anthony Albanese has been a bystander while the Andrews-Allan-Carroll government has drowned Victoria in debt and let crime run rampant.
Time and again, we’ve seen a morally confounded Prime Minister and his government fail to do what’s necessary and right.
We’ve seen Labor fail to show national leadership when the nation has been crying out for leadership.
Labor has failed to crack down on rampant corruption in the construction sector.
Failed to stop the fraud in the NDIS.
Failed to prevent hardcore criminals in immigration detention from being released into the community.
Failed to kick out visa holders guilty of the most heinous crimes.
Failed to remove 77,000 people still on our soil whose visas have been cancelled and who have no legal right to stay.
Failed to stop the spread of antisemitism afflicting Australia which culminated in the tragic Bondi terrorist attack.
Failed to even acknowledge, let alone address, Islamic extremism.
Failed to respond to the outbreak of violence in Alice Springs.
And failed to stand up to radical protesters whose marches have disrupted CBDs and city businesses weekend after weekend.
It’s deeply troubling when a federal government sees protecting our way of life as a lower-order priority.
It’s a sorry state of affairs when a federal government accepts unacceptable levels of crime, corruption, and intimidation as just part of our way of life.
ILLICIT TOBACCO AND THE EXCISE
There’s perhaps no better example than the illicit tobacco trade.
Today, illicit tobacco accounts for an extraordinary 80 per cent of the market.
This is an outcome engineered entirely by government.
Let me be clear upfront:
The Coalition shares responsibility for the situation we now face.
This story dates back to 2010 when the cigarette excise was around $7 a packet in today’s dollars.
In a bid to reduce smoking rates, the Rudd Labor government raised excise by 25 per cent.
Three years later, just before leaving office, they sped up the rate of indexation and legislated four annual excise increases of 12.5 per cent each.
Once in government, the Coalition maintained these increases and added four more from 2016.
Illicit tobacco was a growing problem by 2017.
That’s why the Coalition government established the multi-agency Illicit Tobacco Taskforce around that time.
When the Albanese government took office in 2022, it was clear the black market had taken off.
Nevertheless, Labor legislated a further three annual increases of 5 per cent each over and above indexation.
Since 2010, the excise has more than quadrupled in real terms – now over $30 a packet.
While a packet of cigarettes sells on the black market for around $15, a legal packet can sell for $50 or more.
Eighty per cent of cigarettes sold in Australia are going for around $15 a packet.
That’s the real price of cigarettes in Australia today.
That’s why the black market has exploded.
It’s almost as though the sellers and buyers have no other choice.
Government has put them in that position.
But government intervention didn’t end there.
From 2024, the Albanese government banned vapes.
And just two months ago, they banned oral nicotine pouches.
All three – cigarettes, vapes, and oral pouches – are now a roaring trade for black market operators.
All three are seeing rising overall consumption – particularly among the young.
All three are the direct result of government overreach.
We have a responsibility to protect kids from criminals and reduce their access to tobacco and vaping products, not leave them at the mercy of criminal gangs.
We all know by now that Prime Minister Albanese will never admit he was wrong.
He will never admit he made a mistake.
We all know he will never take responsibility.
But I stand here today openly acknowledging the errors of the past.
And I commit a future Coalition government to fixing them.
That’s the leadership Australians expect and deserve.
That’s the leadership they will never get from Prime Minister Albanese.
THE LEADERSHIP AND POLICY WORK AUSTRALIA NEEDS
Fixing the problem means coming up with a considered plan.
You’ve got to do the hard work.
When One Nation heard that the Coalition was looking to cut the tobacco excise, they rushed out a media release.
But governing this country requires more than a media release or a social media post.
Yesterday, the Coalition announced our policy which has months of hard work behind it.
It’s backed by rigorous analysis by the independent Parliamentary Budget Office – a resource available to all political parties.
Our policy will go much further than simply cutting the tobacco excise, because it must.
I’ll talk through our multi-pronged policy shortly.
But let me make this point:
Governing this country requires a strong team that does the hard work to develop both policies of substance and a credible plan.
After being elected Opposition Leader in February, I appointed Mary Aldred and Senator Richard Colbeck as Co-Chairs of the Coalition’s Illegal Tobacco Taskforce to investigate this important issue.
With a deep understanding of the economy from their pre-parliamentary experience working in business, Mary and Richard consulted experts across the board:
Retailers. Small businesses. Tobacconists. Tobacco companies. Law enforcement officers and officials. Economists. Health professionals. And many more.
Their meticulous work over months was adjacent to a Senate inquiry on illicit tobacco which Richard chaired along with Senator Leah Blyth.
I commend Mary, Richard and Leah for their outstanding work which led to our policy announcement yesterday.
And I make this additional point too:
The policy work the Coalition has done to combat the illicit tobacco black market is part of a larger plan to crack down on the sources of funding that are being used to prop up organised crime in our country.
Deputy Leader Jane Hume is leading policy work to tackle corruption in the building sector.
Mel McIntosh is looking at ways to tackle fraud in the NDIS.
Mary and Richard will continue their work on the taskforce investigating the illicit alcohol trade.
We want to destroy the business model of organised criminals.
For a Coalition government I lead, protecting our way of life will be a top priority.
We’re doing the hard work now to develop policies to curtail the crime, corruption, and intimidation that’s engulfed Australia.
And that starts by crushing the Australian illicit tobacco market which is now one of the largest illicit tobacco markets in the world.
THE IMPACTS OF THE ILLICIT TOBACCO TRADE
Most of the illicit tobacco in Australia is being imported by organised crime groups rather than being made domestically.
Australia is being flooded by three main products:
One: counterfeit cigarettes manufactured illegally that look like legitimate brands.
Two: cigarettes manufactured legally in another country but smuggled in without paying tax.
And three: illegal vapes and oral pouches that contain higher than prescribed levels of nicotine and other dangerous substances.
From Mary and Richard’s work, we know the illicit tobacco trade has three damaging impacts.
Loss of revenue
First, it’s causing a loss of revenue.
As I said, the illicit tobacco market now makes up an estimated 80 per cent of tobacco consumption.
That’s up from just over 10 per cent a decade ago.
While the Australian Border Force is making record seizures, it cannot alone crush the growing illicit market.
Tobacco excise peaked in 2019 at $16 billion a year.
Last year, it had halved to $8 billion a year.
This year, it’s due to halve again to $4 billion a year.
And in three years’ time it is expected to halve again to $2 billion a year.
It’s not hard to predict what happens next.
Meanwhile, no excise is collected on the vapes and oral pouches that are banned.
This is money that could be used to fund schools, hospitals, and pay down national debt.
And we can’t allow such revenue leakage, particularly when Labor has put the nation $1 trillion in debt.
Health implications
Second, the illicit tobacco trade will make Australia sicker.
With consumers shifting from regulated to illicit products, the cigarettes and vapes they’re consuming are even worse.
During the recent Senate Inquiry, the Royal Australian College of General Practitioners expressed numerous concerns:
Illegal tobacco often has “a higher-than-expected nicotine content.”
And illegal tobacco “may contain unregulated ingredients with potentially higher levels of heavy metals, pesticides, or mould which may pose acute health risks.”
The Department of Health has raised concerns about illicit vapes too.
Illegal vapes can contain a range of chemicals that have not been tested for safety.
And more than 200 different chemicals have been found in illegal vapes, including known cancer-causing agents.
The Albanese government has implemented a prescription vaping program where legal vapes are only available at a pharmacy.
Yet this program has been a failure.
The illegal vaping market makes up about 97 per cent of all vaping products.
And if illegal products can contain nicotine despite being labelled nicotine-free, undisclosed ingredients, and toxic contaminants, then leaving the market almost entirely to criminal suppliers is an extremely poor regulatory and health outcome.
If market regulation can shift Australians away from exceptionally dangerous illicit products to legal products, that’s a better health outcome without being an endorsement of smoking.
The dangers of the illegal products are one health issue.
Another health issue is the sheer quantity of illegal cigarettes and vapes on our streets.
The RACGP noted, “The ready availability of cheap, illicit tobacco may compound the problem of rising smoking rates in younger people… to become increasingly tobacco dependent.”
Indeed, since 2017, there’s been a 40 per cent increase in nicotine consumption corresponding to the growth of the illicit market.
Naturally, health professionals want to see smoking rates reduced.
Yet many now recognise that a reduction in legal tobacco consumption has been offset by an escalation in illicit tobacco consumption fuelled by the high excise rate.
The RAGCP noted that because “illegal tobacco bypasses regulatory safeguards, it undermines efforts on smoking cessation.”
The National Heart Foundation said that “cheap, unregulated tobacco is creating an
environment that makes it easier for people to start smoking and harder for people to quit.”
And Australia’s Chief Medical Officer lamented that the Illicit tobacco trade “risks undoing progress in reducing smoking-related harms.”
Illicit tobacco crime
Third, the illicit tobacco trade, with its dark underbelly, is fuelling crime.
Since 2023, more than 200 vendors and retailers – like tobacconists or convenience stores – have been firebombed – with most being in Victoria.
Some have been targeted because they refuse to stock illicit tobacco.
Others because they do stock it – either willingly or under extortion – and have been caught up in turf wars.
Beyond arson, there have been ram raids, threats to vendors, assaults, and armed robberies.
Gang rivalry has seen kidnappings, shootings, and even murder.
The illicit tobacco trade is also punishing legitimate small business owners.
Small retailers and vendors are not just losing customers and profits.
They’re also being forced to pay higher insurance premiums given threats to their businesses.
Remember, many of these tobacconists and convenience stores are small and family-run enterprises known for their longstanding connections and service to their communities.
The illicit tobacco trade has driven consumers online.
Websites and social media platforms have become a means for criminal gangs to mail their products and exploit Australia Post procedures.
Meanwhile, major tobacco manufacturers are considering withdrawing from the Australian market.
If the legal tobacco market is entirely displaced by the illicit tobacco market, there will be no revenue from tobacco excise at all.
AN EXPLOSION IN ORGANISED CRIME
Beyond these three damaging impacts, the illicit tobacco trade has another major ramification which I want to single out:
It’s brought about an explosion in organised crime.
And organised criminals are waging a campaign of economic terrorism on Australians.
The Australian Criminal Intelligence Commission published a landmark report in November last year called Opening the Books.
Serious and organised crime is costing Australia a staggering $82 billion per year.
The report makes a chilling assessment:
Serious and organised crime groups are now a national security threat.
The CEO of ACIC says that these networks are “borderless, decentralised, digitally enabled and increasingly embedded within legitimate systems” and “operate with the agility and sophistication of multinational businesses.”
Let’s be clear.
We’re not dealing with the razor gangs or the Godfather.
We’re dealing with the most sophisticated criminal enterprises.
We’re dealing with a marketplace of crime from illicit tobacco, to money laundering, to drug trafficking, to illegal gun importation, to even terrorism-linked activities.
In June, one of our border force patrol vessels in waters off south-west Darwin was fired upon by smugglers in a fast boat.
They weren’t ferrying cocaine or other narcotics.
Rather, $4.5 million worth of illicit tobacco.
Well-armed and well-financed, criminal syndicates are now so confident they will start a firefight with an Australia government vessel rather than surrender a shipment.
Three things have driven the explosion in organised crime.
First, technology.
Technology has increased the scope, size, and sophistication of organised crime.
These networks use encryption to hide their communication, cryptocurrency to launder, and artificial intelligence to victimise at scale.
An offshore kingpin conducts crime through layers of middlemen who often recruit teenagers to do the dirty work.
A second reason for the explosion of organised crime is hostile states.
A foreign state that wishes to harm Australians doesn’t need to send an operative.
It can subcontract to an Australian criminal network, funded by an Australian black market, using Australian teenagers as the trigger-pullers.
ASIO has attributed the 2024 firebombings of Lewis’ Continental Kitchen and the Adass Israel Synagogue to Iran’s Islamic Revolutionary Guard Corps.
It is alleged that the IRGC used criminal networks to organise and undertake the attacks.
Let there be no doubt that criminal networks and hostile regimes are working together to target Australians.
A third reason for the explosion of organised crime is not from hostile actors but from homegrown ineptitude.
In 2017, the former Coalition government brought our domestic law enforcement and security agencies together in a new Home Affairs portfolio.
We did this for the very reason of better mobilising our capabilities to combat national security threats – like organised crime.
Under the Albanese government, Home Affairs has been ripped apart and reassembled three separate times.
Labor’s been more fixated on bureaucratic tinkering than fighting actual threats.
THE COALITION’S POLICY RESPONSE
Ladies and gentlemen:
In acknowledging the illicit tobacco and organised crime problem, and in understanding that problem through months of hard work and engagement with experts, the Coalition has developed informed policies which we released yesterday.
Let me step you through the four things a Taylor Coalition government will do to crush the illicit tobacco black market and take back control from the gangs.
Excise cut
First, we will cut the tobacco excise by 80 per cent.
This will be reviewed after two years.
Under Labor, the tobacco excise today accounts for about 60 per cent of the retail price of a packet of cigarettes.
Today, a legal packet of 20 cigarettes retails for about $50.
Whereas an illegal packet of 20 cigarettes retails for about $15.
By cutting excise by 80 per cent, the Coalition is effectively returning the excise to 2010 levels in today’s dollars.
In the assessment of the Parliamentary Budget Office, our excise cut will see a legal packet of 20 cigarettes compete sharply with its illicit competitors.
This is why the PBO expects it to convert the majority of the market to legal products within two years.
We will undercut the criminal underbelly.
The success of a drastic excise cut is not without precedent.
In the late 1980s and early 1990s, Canada grappled with an illicit tobacco market too.
After it rolled back its tobacco tax substantially, the illicit market had all but disappeared by the late 1990s.
Now, as I mentioned, our policy isn’t only about cutting the tobacco excise.
It’s a multi-pronged policy.
Law enforcement surge
Second, we will commit $200 million to surge law enforcement efforts.
That means more police investigations.
More police raids and seizures.
More police arrests.
It means no more intimidation of businesses.
No more illegal tobacco shops.
No more illicit tobacco gang violence.
A Coalition government will ensure illicit tobacco crime groups cannot operate in the nighttime or daytime, underground or above, online or off.
Our funding will also support stronger screening resources for the Australian Border Force.
And we will bring in the Australian Signals Directorate to use its cyber and intelligence capabilities to assist the Illicit Tobacco Taskforce with its operational activities.
Regulation
Third, we will dump Labor’s failed ban on vapes and oral nicotine pouches.
In place of Labor’s program, the Coalition will legalise and regulate vapes and nicotine pouches.
We will allow these products to be sold at non-pharmacy retailers, such as tobacconists or convenience stores.
Our regulated program will mean adults can purchase regulated vapes and pouches that don’t contain the excessive levels of nicotine or other dangerous substances of their illicit counterparts.
And it will give us a much greater ability to protect children by restricting their access to these products and keeping them out of the hands of criminal sellers and counterfeit products.
And it will mean a greater ability to curb children’s access to counterfeit vapes and pouches.
Both the United Kingdom and New Zealand have implemented a similar regulated approach.
We need to be realistic and pragmatic.
Australians will get access to nicotine, one way or another.
And so, access must be done in a way that minimises harm – and that’s only done through a lawful and regulated system.
Advertising campaign
Fourth, we will commit $60 million to a public advertising campaign.
The campaign will focus on the harm caused by illicit tobacco.
It will highlight how the illicit tobacco market fuels organised crime, costs Australians through lost revenue, and harms people with dangerous products.
It will also remind Australians of the dangers of smoking in general to reinforce existing Quit Smoking messaging.
CONCLUSION
Ladies and gentlemen:
Let me make this very important point:
We will take the policies I’ve outlined to the next election.
But there’s no time to waste.
We need to fix the problem of illicit tobacco and crush organised crime right now.
So I’m calling on the Albanese government to not delay – to implement our plan in full.
We will work with Labor in the coming weeks of parliament to do exactly that.
If the government refuses to act, then every tobacco-related firebombing, every tobacconist threatened, every incident of gangland violence from here on in will be on Labor’s head.
In closing:
I’m exceptionally proud of the Coalition’s comprehensive policy to crush the Australian illicit tobacco market and organised crime.
We must protect our kids from criminals.
We must protect taxpayers from billions-of-dollars in lost revenue.
And we must unequivocally protect Australians from the violence and intimidation of organised crime.
We know our policy will be effective because there’s substance and hard work behind it that only a strong Coalition team can deliver.
Let me emphasise again:
This policy is part of a larger plan.
To combat crime.
To curtail corruption.
To curb intimidation.
Crime, corruption and intimidation should never have been normalised in our country.
But they have been because a weak Albanese Labor government has accepted the unacceptable.
I reject the current state of affairs as the new status quo.
Under my leadership, just as we will reverse Australia’s economic decline, we will reverse Australia’s law and order decline and protect our way of life.
Criminal gangs will be rooted out.
Visa overstayers will be booted out.
Extremists will be kept out.
Radical protests will be snuffed out.
And antisemitism will be stamped out.
To any Australian who no longer recognises the country we love, who wants to protect our way of life, like the Coalition, lend us your support, join us, fight with us to save Australia, because Australia is worth fighting for, now more than ever.