Illegal tobacco scourge hurting small businesses, community

Retailers are losing out on thousands of dollars due to the increasing illegal tobacco trade, says the Australasian Association of Convenience Stores.

On Saturday, police from Orana Mid-Western Police District located 800 kilograms of freshly baled tobacco in a car travelling through Dunedoo.

AACS CEO Jeff Rogut said tobacco sold legally in convenience stores, typically accounted for about 38 per cent of sales.

“With the growth of illegal tobacco many of these small businesses have lost sales to criminal activity. Some of them are losing between $1000 and up to $3000 or $4000 a week to this illegal tobacco,” Mr Rogut said.

It was really hard for the businesses, like an IGA or convenience store, to make up for the lost profit, he said.

However, it’s not only the businesses who are losing out.

“In 2016 illegal tobacco accounted for about 14 per cent of the total tobacco market. The official figure that the government loses in terms of tax on tobacco is about $1.6 billion every year and if you talk to people in Border Force or those areas they believe it is two or three times that amount,” Mr Rogut said.

“It’s a huge amount of tax that could go towards schools, hospitals, all the things government does with that kind of tax. That’s all being siphoned off and going towards criminal activity.”

Illegal tobacco was a “scourge on the community”, Mr Rogut said.

Smoking kills, he said, but consumers were putting themselves at a greater risk buying illicit tobacco as there was no way of knowing the ingredients.

To end the scourge there needed to be greater enforcement of the regulations, Mr Rogut said, as well as greater deterrents at a street level.