No butts: fines and jail for illegal cigs and vapes

Farid Farid | June 29, 2025

Shutting down dodgy tobacco shops, hefty $1.5 million fines and seven-year jail terms have been floated to curb an illicit economy of smoke dens triggering gang wars and firebombings.

The NSW opposition is ramping up its tough on crime rhetoric with a bill to be introduced in parliament vowing to stamp out a ballooning black market of cheap cigarettes and vapes.

The move would give the health ministry and magistrates the power to close down businesses selling products clandestinely and penalise landlords if their tenants carry the illegal items.

For serious offenders, the coalition wants prison sentences of up to seven years or $1.5 million fines.

“These dodgy shops are all over our suburbs, run by criminals selling illegal tobacco and vapes like it’s completely normal,” opposition leader Mark Speakman said.

“Our plan will shut these shops down, hit the criminals with million-dollar fines or jail, and make it crystal clear — if you’re dealing illegal tobacco in NSW, your days are numbered. No more soft touch. No more excuses.”

The coalition’s plan comes as the state government kicks off a mandatory licensing scheme on Tuesday requiring all retailers selling tobacco and smoking products to hold a valid permit or risk fines more than $10,000.

Tobacco prices have been driven by a federal excise topping $1.40 a cigarette in March, excluding shop mark-ups, with the average pack of 20 costing about $40.

The excise has increased from $16 to $28 a pack in six years but total revenue is going backward as consumers flee to the black market.

Revenue from the tobacco tax peaked at $16.3 billion in 2019/20 but has dipped to a projected $7.4 billion this financial year, 

Along with the tobacco tax, landmark federal laws that took effect in October mean vapes can only legally be sold through pharmacies.

Health Minister Mark Butler said the federal government’s approach to “taking on big tobacco on the one hand and organised crime on the other,” was working.

Federal law enforcement agencies have confiscated about eight million vapes, valued at more than $230 million, in a national crackdown since the start of 2024.

More than 30 locations were raided in Queensland with about 75,000 vapes and 20 million cigarettes seized in May.

In Victoria, illegal tobacco sales have prompted regular violence, with more than 100 firebombings in two years.