Illicit tobacco raids seize 8 tonne, worth $10m of ‘chop chop’
THE Australian Taxation Office seized and destroyed more than 131 tonnes of illicit tobacco last financial year, representing estimated excise forgone of $171 million.
The illicit tobacco, sometimes referred to as "chop chop" has been easily available in the Gympie region.
GYMPIE REGION NEWS:
This includes activity undertaken by the ATO as part of the Illicit Tobacco Taskforce (ITTF).
With the assistance of Queensland Police, New South Wales Police, Victoria Police and Australian Border Force, ATO officers executed 19 search warrants and uncovered over 184 acres of illicit tobacco growing in hot spots across regional New South Wales, Victoria and Queensland, one near Maryborough.
The largest single seizure was in Lake Bolac in Victoria, with the ATO, Victoria Police and Australian Border Force officers locating 31.4 acres of tobacco, seizing and destroying 28 tonnes worth about $36.6 million in lost excise.
A total of 65 tonnes worth about $85 million was seized and destroyed in New South Wales, 57.8 tonnes worth $75.5 million in Victoria and 8 tonnes worth $10 million in Queensland.
Assistant Commissioner Ian Read said these outcomes demonstrated the ATO's commitment to disrupting organised crime syndicates that produce and supply illegal tobacco for sale on the black market in Australia.
"The trade in illicit tobacco products in Australia has widespread negative consequences across the community," Mr Read said.
"Tobacco growing operations are not run by small producers or farmers. They are run by organised crime syndicates who deliberately engage in illegal activities to fund their extravagant lifestyles and other criminal activity."
"We're finding crops in regional and remote areas of the country, being grown on land being leased from unsuspecting owners under the guise of growing vegetables," he said.
"A number of these operations were as a result of tip-offs from concerned members of the community, and I urge people to keep reporting any activity they suspect may involve the production of illicit tobacco. Public tip-offs build on the intelligence we gather from a range of sources and help us to identify, seize and destroy these illicit crops before they are harvested and sold on the black market."
If you suspect that illegal tobacco is being grown or manufactured in your community you can confidentially report it online at ato.gov.au/illicittobacco or by calling 1800 060 062.
Signs to look out for include intense labour production between November and May, suspicious inquiries about land for lease, unexplained use of water resources and large crops of leafy plants that may resemble kale, cabbage or corn.
The ATO is responsible for the administration of the Excise Act 1901 and Excise Regulations 1901 which provides licensing and legislative requirements for the production, manufacture, movement and payment of excise duty on goods which include tobacco. Currently there are no farms in Australia that have a producer's license to grow tobacco.
The Commonwealth Director of Public Prosecutions (CDPP) has provided advice to the effect that State Police can investigate and launch prosecutions for specific tobacco offences under the Taxation Administration Act 1953 (TAA). These offences are those where jail is prescribed as a penalty - the 100kg plus offences. So those are the offences where QPS can arrest/prosecute.
Offences that do not carry a jail term are 'prescribed taxation offences' and only able to progressed by a taxation officer - quantities under 100kg.
The offences QPS can investigate and prosecute are:
Reasonable Suspicion offences:
DIV 308-10 Possession of tobacco 500kg or above. 5 years imprisonment
DIV 308-15 Possession of tobacco 100kgs or above. 2 years
There are also identical penalties for selling and buying the above quantities.
Fault based offences:
DIV 308-110 Possession of tobacco 500kg or above. 10 years imprisonment
DIV 308-115 Possession of tobacco 100kg or above. 5 years
DIV 308-125 Manufacture or production of tobacco 500kg or above. 10 years imprisonment
DIV 308-130 Manufacture or production of tobacco 100kg or above. 5 years
A further caveat on the above is that police do not have power to execute Excise Act Search and Seizure warrants which provide the power of entry/search.
The ATO swear and execute the warrants, handle the crop measurements, sampling, weighing and analysis whilst state police take carriage of the actual investigation.
Last month, ATO investigators in conjunction with the Queensland Police Firearm and Cannabis Team investigators have identified a number of properties involved in the illegal production of tobacco in the Maryborough/Bundaberg areas. Excise Act search warrants were executed at these properties.
On June 22, Maryborough Biggenden Road, Gumgaloom, more than 500kg of illegally grown tobacco located and destroyed. A 59-year-old man was charged with one count of Possessing Tobacco (500kg or above) in contravention of s308.110 Taxation Administration Act 1953 by QPS and is due to appear in the Brisbane Magistrates Court on August 3.
On June 22, at Steeds Road Winfield and Whalleys Road, South Kolan. Illegal tobacco crops were located to value of $7.6 million dollars. Investigations continue.
Illicit Tobacco Taskforce
The ATO is part of the ITTF that is led by the Australian Border Force. The ITTF was established on 1 July 2018 to investigate, prosecute and dismantle organised crime groups who use the proceeds of illicit tobacco to fund other criminal activity, as well as ensure the appropriate revenue is paid to the Australian Government.
Australian Border Force Special Investigations Commander Greg Linsdell, said the ITTF is dedicated to disrupting the supply of illicit tobacco and dismantling the criminal syndicates that support the illicit trade.
"As at 30 June 2020, the ITTF has effected the seizure of more than 75 tonnes of smuggled tobacco and approximately 361 million smuggled cigarettes. This is equivalent to over $399 million in evaded duty," said Special Investigations Commander Linsdell.
Illicit tobacco costs the Australian community $647 million in lost revenue each year. It takes vital money away from the community and places it directly in hands of organise crime groups.
NSW Police Force State Crime Commander, Assistant Commissioner Stuart Smith, said police actively target and investigate those involved in the illegal tobacco trade across the state.
"Despite the warnings, tobacco remains a key facilitated import by organised crime syndicates in an attempt to evade authorities for significant financial benefit.
"In the past year, the NSW Police Force have assisted considerably in the execution of warrants and dismantling of locally grown tobacco crops established right across New South Wales - spanning from the Mid North Coast, out to the state's Central West and Southern Tablelands. Together with our law enforcement partner agencies, NSW Police will continue to put those participating in and facilitating these illicit activities before the courts," said Assistant Commissioner Smith.
It has been illegal to grow tobacco in Australia for more than a decade. If convicted, growing tobacco carries a maximum penalty of up to 10 years' imprisonment.
For more information about illicit tobacco, visit ato.gov.au/illicittobacco