Source: Radio New Zealand
A Retail NZ report estimated that more than 27 percent of tobacco smoked in 2024 was illicit. Supplied / New Zealand Customs
Customs, police and the health sector are combining forces to crack down on illicit tobacco, with a new “action group” the government announced Friday.
Minister for Customs Casey Costello said increasing numbers of black-market cigarettes and tobacco were being seized at the border, and there was been more widespread and blatant retail sales of the illegal products.
RNZ has been investigating the issue over the last month, uncovering multiple shops operating in Auckland selling the cheap tobacco products.
An East Auckland store was charging just $13 for a pack – less than half the excise duty required by law.
Importing cigarettes without paying the excise duty is illegal, and offenders can be charged with defrauding customs revenue.
It was also illegal for retailers to sell illicit cigarettes, with offenders facing a six-month prison sentence, a $20,000 fine or both.
Retail NZ released its report on the illegal sale of cigarettes in April, calling for a dedicated taskforce of health, customs, and police to address the issue.
The report estimated that more than 27 percent of tobacco smoked in 2024 was illicit.
On Friday, Costello said an organised response was required to get on top of the issue.
“The individual agencies are doing their roles well and there is good cooperation around operations and local initiatives, but we need to bring all of these powers and resources together as effectively as we can to stop this black market,” she said.
The government has established the action group with improved planning and joint operations to combat the illegal trade.
“A key shift, given the involvement of criminal gangs in the illicit trade, is formalising the role of police in supporting other enforcement activity,” Costello said.
“Customs and police have also stepped up their engagement with overseas counterparts. As with other illegal trade, New Zealand benefits from stopping supply before it gets to our country.”
Officials in the health sector were also working to improve tobacco control legislation.
Costello was also calling on the public to do their part.
Minister for Customs Casey Costello said increasing numbers of black-market cigarettes and tobacco were being seized at the border. Supplied
“Buying cheap cigarettes isn’t a harmless crime. Money from the sale of these cigarettes funds gangs and overseas cartels and leads to violent crime, intimidation, and extortion in our communities.”
Retail NZ chief executive Carolyn Young, said the increased pressure on the illicit market was a good first step, but wanted the government to go further.
“We would like for further investment in customs to enhance our border protections and intelligence, tougher penalties for those caught importing and selling illicit tobacco, and banning online tobacco sales,” she said.
“We also believe establishing an independent panel of experts to consider what tobacco controls, enforcement tools, and enhanced public messaging could make a meaningful difference in this space would be hugely beneficial in finding a way to stamp out the market for good.”
A Growing Concern
RNZ has spoken to a number of experts on the issue as part of its investigation into illicit tobacco.
One such expert was retired Australian homicide detective Charlie Bezzina, who said the genie was out of the bottle across the Tasman.
“Given the fact that we’ve let this ferment, and it’s fermented, it’s grown, it’s spread, it’s like a cancer, and then to try and then start implementing resources is quite difficult,” he said.
“If it’s in its infancy in New Zealand, you have to learn by our mistakes.”
Bezzina said New Zealand law enforcement should speak with Australian law enforcement, who possessed a wealth of information on the issue.
He said Victoria’s state government had been slow to respond to the organised crime element.
Chief executive of the Asthma and Respiratory Foundation, Letitia Harding, also raised concerns about the lack of health warnings featured on the illicit packets of smokes.
Of the 15 different packs of cigarettes at the store RNZ visited, only one carried the mandated health warnings.
“They do deter people,” she said.
“I think it’s a reminder that cigarettes do have a long lasting negative impact on your health and can cause death.”
Market Numbers Questioned
Amid the unease over the country’s budding black market for illicit tobacco, concerns were also raised that the issue was being overblown by interest groups.
The director of Action for Smokefree Aotearoa NZ, Ben Youdan, said when it came to tracking and researching the black market, transparency was key.
“The tobacco industry’s got a long history of exploiting a lot of different people and voices in their own commercial interests,” he said.
“I think there’s definitely some genuine concerns for especially small retailers around some of those issues around tobacco, the tobacco industry always has another interest in telling this story, but there’s definitely an issue in there that we shouldn’t just be dismissing.”
Youdan urged leaders to think critically about what they were being told.
“Really kind of asking those questions about whose arguments are they, who’s setting the playbook on this, and really making sure it’s as legitimate as possible.”
“I think that’s incredibly challenging given the long history that industry has had in this debate and stoking the fire around illicit tobacco.”
The 27 percent consumption figure used in the Retail NZ report was originally sourced from a separate 2025 report which was prepared for the exclusive benefit and use of Imperial Tobacco New Zealand and British American Tobacco New Zealand.
However, Retail NZ said while its paid-up members include those companies, the report it released was researched and written independently by Retail NZ staff.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand