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Australia’s Bureau of Statistics reported on June 3, 2026 that an estimated 80% of tobacco and nicotine products consumed in 2025 came from illicit sources, up from about 12% in 2017.
The ABS’s experimental estimate combined nicotine metabolite levels in wastewater with sales and spending data and found overall nicotine consumption rose nearly 40% between 2017 and 2025 while household spending on legal tobacco fell to around 2016 levels.
Steep excise rises on legal products — prices for some legal packs have roughly tripled since 2016 — are seen as a key driver pushing smokers toward cheaper illegal supplies.
The shift has hit tax revenue: Treasury recently downgraded excise receipts (reports cite an approximate A$8 billion reduction over five years and a revision of expected 2025–30 excise receipts to about A$15.4 billion from A$27.3 billion). Authorities report large seizures and state enforcement actions, and jurisdictions have introduced tougher penalties for sellers and landlords.
The findings have intensified debate over whether to cut excise, boost enforcement, or reform nicotine policy to reduce the black market.






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