Experts urge rethink as illegal tobacco trade booms across Australia

Wednesday 15 April 2026

Tobacco excise has increased by over 60% since 2020, accounting for more than two-thirds of the legal cost of a pack of cigarettes.

While illegal cigarettes are widely available and cost between $10 and $15 per pack of 20, a legal pack of cigarettes currently costs $40 or more.

As a result, despite increasing taxes, the federal government has recorded a considerable reduction in tobacco excise revenue, which is expected to fall further.

The full text of this article is available to MacroBusiness subscribers

$1 for your first month, then:

$24.99 / month

$249 / year

Cancel at any time through our billing provider, Stripe

About the author

Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.