As reported in news media, the increasing size and frequency of black market tobacco seizures should prompt the Government to take an uncompromising stance to combat it, according to Imperial Brands.

According to official Customs information, total interceptions of illegal cigarettes and cigars grew 31.4%, from 4.94 million in 2019–2020 to 6.5 million in 2023–2024.

New independent data commissioned by Imperial Brands and BAT shows almost one in four cigarettes smoked in New Zealand is sourced illegally, amounting to over $500 million in lost excise tax. This makes tobacco smuggling the largest source of revenue evasion according to New Zealand Customs.

John Mitchell, Imperial Brands Corporate and Legal Affairs Manager, says:

“The black market is growing year on year, both in size and sophistication. Increasing reports of Customs seizures is welcome news, but their efforts must be better supported with tougher policies and laws that can deter or punish criminals.

“The Minister says organised criminal activity inflicts misery on communities, and harms legitimate businesses and the broader New Zealand economy. This is precisely the toll of the tobacco black market, which remains unchecked.

“The government’s decision to establish a Ministerial Advisory Group on transnational and serious organised crime is encouraging news for the fight against the tobacco black market. Directing it to investigate the scale, participants and harm caused by the black market is a very worthwhile start.

“They should also speak with their Australian counterparts to learn what actions are being taken over there. This includes the formation of a formal cross-agency illicit tobacco taskforce and much tougher sentencing for those that break the law. Both will send a clear, unequivocal message that criminals will be punished.”

The latest data by FTI Consulting, commissioned by Imperial Brands and BAT shows that while legal tobacco consumption declined by 12% in 2023, consumption of black market tobacco rose by 37%. Over the past four years, the size of the trade has doubled from 11.5% of the market in 2019 to 23.6% in 2023.

Mr. Mitchell points to Australia as a cautionary example of the risks associated with inaction.

“Australia took a number of worthwhile steps, but even they would admit they acted too slowly. The tobacco black market is close to uncontrollable. Violence and fire-bombings in New South Wales and Victoria are reported in the news daily.

“It would be a mistake to assume New Zealand will avoid the problems of Australia, at a time when Australian gangs are known to export their criminal tactics to New Zealand. In fact, the data shows we’re already on that trajectory.

“There is still time for the government to act, before the trade in illegal tobacco products gets out of control. The industry has specialist knowledge and expertise in combatting black market tobacco and we are ready, should the government require our support and assistance.”

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