ATO seizes $171m worth of illegal tobacco - Inside FMCG

ATO seizes $171m worth of illegal tobacco

The Australian Taxation Office (ATO) destroyed more than 131 tonnes of illicit tobacco in the year to March under the government’s Illicit Tobacco Taskforce (ITTF) programme battling contraband cigarettes.

The estimated value of excise tax lost to the country is $171 million.

The New South Wales Police, Victoria Police, Queensland Police and Australian Border Force and ATO officers joined forces to execute 19 search warrants, uncovering more than 184 acres of illegal tobacco in the three states.

ATO said in a statement that the biggest seizure was in Lake Bolac in Victoria where, with the help of Victoria police and Australian Border Force officers, it found and destroyed 31.4 acres of tobacco worth about $36.6 million in lost excise tax. Another 65 tonnes (valued at $85 million) was seized and destroyed in New South Wales; approximately 57.8 tonnes (valued at $75.5 million) in Victoria and about 8 tonnes (valued at $10 million) in Queensland.

“The trade in illicit tobacco products in Australia has widespread negative consequences across the community. Tobacco-growing operations are not run by small producers or farmers. They are run by organised crime syndicates who deliberately engage in illegal activities to fund their extravagant lifestyles and other criminal activity,” said ATO assistant commissioner Ian Read.

“We’re finding crops in regional and remote areas of the country, being grown on land being leased from unsuspecting owners under the guise of growing vegetables. A number of these operations were as a result of tip-offs from concerned members of the community, and I urge people to keep reporting any activity they suspect may involve the production of illicit tobacco.”

He added that Aussies reporting illegal cigarettes helped their investigation in identifying the companies making them. They apprehended the contraband before it reached the black market. He urged the public to report further any anomalies via ATO’s website or by calling 1800 060 062.

He said Australians should look out for signs such as intense labour production between November and May; suspicious enquiries about land for lease; dubious sources of water resources and having large leafy plants that look like kale, cabbage or corn.

“As at 30 June 2020, the ITTF has [effected] the seizure of more than 75 tonnes of smuggled tobacco and approximately 361 million smuggled cigarettes. This is equivalent to over $399 million in evaded duty,” said Australian Border Force special investigations commander Greg Linsdell.

Illicit tobacco costs the Australian government an estimated $647 million in lost revenue every year.

“Despite the warnings, tobacco remains a key facilitated import by organised crime syndicates in an attempt to evade authorities for significant financial benefit,” said NSW police state crime commander, assistant commissioner Stuart Smith.

Last year, the convenience industry group Australasian Association of Convenience Stores criticised the West Australian Government for introducing new legal tobacco display regulations at the cost of retailers.

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