Organised criminal networks are seeing an opportunity in New Zealand's "attractive" illicit tobacco market, with new figures showing that almost 12 million cigarettes and cigars have been stopped at the border this year.
According to figures obtained by Breakfast, Customs has seized 11,971,995 individual cigarettes and cigars across 486 seizures so far in 2026. Compared to 2023, when Customs seized 8.2 million cigarettes and cigars across 2434 busts, it's an increase of nearly 4 million.
Customs Deputy Controller of Operations, Jamie Bamford, told Breakfast that organised crime was reaching into the tobacco game and "starting to get its claws into New Zealanders".
He said there was a "healthy, fat profit" to be made in New Zealand.
"We are seeing offshore syndicates, crime groups in Australia, particularly identifying New Zealand as an attractive market, and they're using their sophisticated techniques basically to smuggle large quantities of tobacco."
In New Zealand, front companies were set up to bring the products into the country.
Bamford said these fronts used "a lot of organisation" and showed "innovation" to get tobacco in.
"Someone might have a legitimate business, and they start running another line where they're importing illicit tobacco, or they might actually just set up a company for the sole purpose of bringing in tobacco.
"But it might be, for example, a furniture company or something like that, where they can conceal the cigarettes."
A report commissioned by the tobacco industry by FIT Consulting earlier this year found that in 2025, 33.5% of all tobacco consumed in New Zealand was illicit. It estimated that illicit tobacco cost the Government $817 million in lost excise and GST revenue.
In Australia, the situation was more serious. The Australian Bureau of Statistics reported 80% of tobacco consumed in 2025 came from illicit sources – up from 12% in 2017. The contraband boom has been linked with gang violence, prompting some politicians to call for a slashing of the country's high tobacco excise.
New Zealand also has a high tobacco excise, with revenue used to fund public services.
Bamford said organised crime was seeing an opportunity to exploit New Zealanders.
"There is a financial incentive there," he said. "Organised crime is driven by making money, and they see there's an opportunity, and so that's why we're starting to see it take off here."
He said the low cost of illegal cigarettes also gave them an advantage over legal brands – at a possible cost to people's health.
"What you're dealing with now is people with a shed in the jungle making tobacco, and you've got zero idea what is in it.
"And as we see with drugs, they lace them with different things, so there's no control."
Illicit tobacco was a "challenge" for Customs to fight, Bamford said, as it was hidden among legitimate trade.
"We have a role in expediting that and getting our goods in and out of this country, you know, hassle-free at the border.
"So we need to use our technologies and our equipment and our kind of intelligence to try and identify this."
He said the drop in interceptions was due to the digital traveller declaration, where people coming from overseas can declare that they're bringing tobacco into New Zealand.
In May, the Government established a multi-agency Illicit Tobacco Action Group – combining Customs, police, Health New Zealand, and the Ministry of Health.
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