Australia has one of the lowest smoking rates in the OECD and has been a leader in anti-smoking initiatives since the 1970s. Successive governments have introduced a broad range of innovative measures to discourage tobacco use but regular excise increases have been one of the main (and most effective) pillars of Australia’s anti-smoking strategy. However, during the past decade, that progress was under threat as more people picked up vaping and organised crime groups increasingly moved into the illicit tobacco market. In 2025, under-the-counter cigarettes (and vapes) were widely available in cities such as Melbourne and Sydney at prices far cheaper than legal brands.
As competition between rival gangs spilled onto the streets in the form of fire-bombings, robbery and violence, state and federal governments faced a hydra of a problem.
This case study explores the unintended outcomes from the Australian government's use of tobacco excise as a tool to reduce smoking, including its impact on crime, excise revenue and vulnerable populations. It also discusses the federal and state governments’ attempt to combat the issue and ensure Australia hits its target of a 5 per cent smoking rate in 2030.
Author: Marinella Padula
Published Date: 12 November 2025
Author Institution: ANZSOG
Content Length: 18 pages
Product Type: Case with teaching note - for a copy of the teaching note contact caselibrary@anzsog.edu.au