Victoria’s new tobacco watchdog has seized nearly $5 million in illicit goods in its first month of operation, as the state government prepares to hand inspectors "shut-down" powers as part of their illicit tobacco crackdown.

According to state government data, Tobacco Licensing Victoria (TLV) has seized 3.19 million cigarettes, 2243 cigars, 40kg of loose-leaf tobacco and 32kg of shisha tobacco since being introduced in February this year.

On 12 February, just a week after the new legislation, Wangaratta police seized $10,000 worth of allegedly illegal tobacco and vapes from a Phillipson Street tobacconist in Wangaratta.

The state government has also announced under laws to be introduced later this year, TLV will have the power to order businesses caught selling illicit tobacco to close.

Landlords will be given new powers to kick out businesses selling illicit tobacco and those knowingly allowing those sales to continue will face new penalties.

Inspectors will also get the power to destroy seized illicit tobacco pre trial.

Individuals caught face fines of up to $370,000 or 15 years’ jail, while businesses face penalties of more than $1.8 million.

Minister for Casino, Gaming and Liquor Regulation, Enver Erdogan, said inspectors were moving fast to crack down on people doing the wrong thing.

“Illicit tobacco fuels organised crime, and we’re shutting down the operators who think they can get away with it,” he said.

The crackdown on illicit tobacco came after an organised crime war on the illicit tobacco trade broke out in Victoria over recent years.

By mid-2025 there had been 125 fire bombings of tobacco stores across the state, including two in the North East in 2023 and one in Mooroopna on 26 February this year.

A recent report released by Oxford Economics Australia showed significant decline in federal tobacco excise revenue in recent years, which is forecast to plummet to $1.5 billion in 2028-29.

Ovens Valley MP and shadow minister for consumer affairs Tim McCurdy said illegal stores are continuing to spread across local communities as criminal gangs fight over the lucrative illicit tobacco trade.

“For a long time, we have been raising concerns that the government was moving far too slowly to deal with this growing black market.”

“From the start we said that having just 14 authorised officers to police illicit tobacco across the entire state was never going to be enough to tackle a problem being driven by organised crime.

“The government needs to stop governing by press release and start focusing on real enforcement.

“This issue has been allowed to grow for too long and it’s time the government put the resources on the ground to properly deal with it.”

For more information including reporting suspicious activity or to view the licensed list, visit vic.gov.au/tobacco-licensing.