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Fears NZ’s tobacco black market will get as bad as Australia’s
New Zealand Customs has warned tobacco smuggling is becoming more organised, large-scale and sophisticated, with the government pledging to stop the country following Australia into tobacco gangland warfare.
But a public health professor says while criminal involvement is a concern, there is no evidence of a dramatic increase in the size of the tobacco black market.
Chief customs officer for fraud and prohibition Nigel Barnes said seizures have been trending upwards over the past decade, though there have been fluctuations due to large busts.
Tobacco smuggling becoming more organised and large scale
In 2025, Customs seized 11.1 million illegal cigarettes and cigars, and 5.4 tonnes of loose tobacco, compared to 9.2 million illegal cigarettes and cigars, and 2.7 tonnes of loose tobacco in 2024.
In 2022, 4.8 million cigarettes were seized, and 3.6 tonnes of loose tobacco.
Barnes said illicit cigarette seizures in 2025 represented about $16 million in tax revenue evasion.
“That’s just the stuff we’ve seized.”
In August 2025, Customs officers intercepted two separate consignments from China: the first containing 340,000 uncustomed cigarettes of the Chinese brand ‘Double Happiness’, and the second containing 587,000 cigarettes of the same brand. Photo: NZ Customs Service
He said illegal cigarettes were selling here for between $20 and $25 in diaries, liquor stores and pop-up outlets throughout the country. A legal packet costs between $40 and $50.
“Obviously, there’s a significant-size market in Auckland, but we’ve identified illicit tobacco distribution networks in regional centres as well, as far afield as the South Island and Gisborne.”
Barnes said the increase in seizures partly reflected a $10.4m funding boost in 2022 and the establishment of a dedicated illegal tobacco investigations team.
But the involvement of transnational and serious organised crime groups concerned him.
“Tobacco smuggling into New Zealand is becoming more organised, large-scale and sophisticated.”
Criminals were increasingly adding tobacco to their drug and money laundering operations, he said, and smugglers were masking themselves under shell companies.
An estimated 1200 kilograms of loose tobacco in a storage unit obtained during search warrants in Auckland in 2025. Photo: Supplied
Officials had seized drugs, firearms and other weapons, as well as large amounts of cash in investigations.
In 2023, Customs arrested three Malaysian nationals who travelled to New Zealand to smuggle tobacco into the country. When officials did some digging, they found out the trio had the same operation in Australia.
Agents also discovered a large illegal cigarette manufacturing operation in 2024 in Christchurch, where a man had imported loose tobacco under the guise of tea, setting up machinery to make individual cigarettes, boxes of cigarettes and cigarette branded labels.
Barnes said the trajectory of Australia’s black market for tobacco was “particularly concerning” for New Zealand.
“We’re in contact regularly with our Australian counterparts, and the trajectory of the illicit tobacco market in Australia is particularly concerning, mostly because New Zealand and Australia have the highest excise rates in the Asia-Pacific region. So if it could happen there, it could happen here, is a kind of a theory.
“The standovers and firebombs that are getting reported on in Australia are particularly concerning for us.”
Barnes said Customs was doing everything it could to prevent New Zealand following Australia’s path.
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The chief executive of the Parliamentary Service is confident there will be enough room to accommodate the increased number of MPs and their staff coming into Parliament.
On current numbers, up to 131 MPs could be sitting in the Chamber following the election, brought on by a record overhang result.
Clerk of the House of Representatives Dr David Wilson told the Spinoff that currently the debating chamber had enough chairs to seat 124 MPs – including the Speaker of the House – and work was being done to accommodate more by altering the seating arrangement.
In a statement, Parliamentary Service chief executive Rafael Gonzalez-Montero said planning for a larger Parliament had been going for “some time”.
“Now that the election results have confirmed an increase to the number of members we are looking at several options.
“We are confident we will be able to accommodate all members within the Chamber.”
VNP / Phil Smith
Gonzalez-Montero said office accommodation for members and their staff would be “stretched” for a short time, but the new Members’ Building was only a few months away from “practical completion”.
That building – located behind Parliament – was due to be ready to occupy in April next year and had capacity to accommodate around 30 backbench MPs.
“All members should be in fit-for-purpose accommodation from that point,” Gonzalez-Montero said.
Following the 2023 election, 123 MPs sat in the Chamber – a record number at the time. That decreased to 122 following the resignation of National MP Judith Collins.
Collins held the seat of Papakura and stepped down in May and Parliament voted against holding a by-election because it was too close to the election.
The election result also meant high-ranking National Party MPs like Chris Bishop, Paul Goldsmith, Nicola Willis and Gerry Brownlee – Speaker of the House and an MP for 30 years – would likely not make it back into Parliament.
Only resigning or retiring MPs were permitted to give a valedictory speech meaning none of them would get the chance to give a valedictory statement.
Asked if their would be special allowances for valedictories, Wilson said in a statement that normally only MPs were allowed to speak in the House but the House could suspend its own rules or temporarily alter them.
“It could do so to allow former members to address the House.”
Wilson said no such arrangements could be made until the next Parliament opened and members sworn in.
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