Latest / Real Crime with Adam Shand / From the Desk - Is Australia creating its next black market?

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From the Desk - Is Australia creating its next black market? · Real Crime with Adam Shand

• 0:05
  Speaker 1: Appoche production. Australia has spent years fighting an illicit tobacco
• 0:14
  Speaker 1: war entirely of its own, making fire bombings, organized crime,
• 0:19
  Speaker 1: turf wars, billions of dollars disappearing into the black economy.
• 0:22
  Speaker 1: But here's the question, are we now watching exactly the
• 0:25
  Speaker 1: same thing happen with alcohol? Melbourne liquor retailers are calling
• 0:30
  Speaker 1: on the state government to take immediate action over fears
• 0:33
  Speaker 1: the illicit alcohol threat is escalating a crime from the
• 0:38
  Speaker 1: coal face lawmakers do better. Welcome to Real Crime with
• 0:42
  Speaker 1: Adam Shann. I'm your host Adam Shann, and in my
• 0:45
  Speaker 1: new Friday feature from the Desk today, I want to
• 0:48
  Speaker 1: look at whether government tax policy is unintentionally creating another
• 0:52
  Speaker 1: lucrative market for organized crime, and to ask the question,
• 0:56
  Speaker 1: have we learned nothing from the tobacco wars.
• 0:59
  Speaker 2: We want to be a legal business selling legal product.
• 1:03
  Speaker 2: We don't want to be pushed out of that market.
• 1:06
  Speaker 1: We have some of the highest alcohol taxes in the world.
• 1:09
  Speaker 1: Every beer, bottle of spirits and cask of wine carries
• 1:13
  Speaker 1: significant excise or wine equalization tax. Those taxes increase regularly.
• 1:19
  Speaker 1: The intention is understandable, even commendable governments want to reduce
• 1:23
  Speaker 1: harmful drinking while raising revenue. But criminals don't pay excise.
• 1:28
  Speaker 1: They simply see opportunity. We've already seen what happened with cigarettes.
• 1:33
  Speaker 1: Legal packets became so expensive that millions of Australians have
• 1:36
  Speaker 1: switched to illicit tobacco, and organized crime stepped in. Victoria's
• 1:40
  Speaker 1: suffered dozens upon dozens of tobacco shot, fire bombings. Businesses
• 1:44
  Speaker 1: are being extorted, crime syndicates are making enormous profits. The
• 1:49
  Speaker 1: black market emerged because the difference between the tax product
• 1:52
  Speaker 1: and the untaxed product has become extraordinarily profitable. So as
• 1:57
  Speaker 1: alcohol next, there are already illegal distilleries operating in Australia.
• 2:02
  Speaker 1: Authorities continue to seize counterfeit spirits, illegally imported alcohol, and
• 2:07
  Speaker 1: homemade products that avoid excise completely. Some fake spirits are
• 2:11
  Speaker 1: sold in bottles carrying the labels of premium brands. Others
• 2:15
  Speaker 1: are produced in backyard stills with little or no quality control.
• 2:20
  Speaker 1: The danger isn't simply tax avoidance. Poorly produced alcohol can
• 2:25
  Speaker 1: contain dangerous contaminants capable of causing blindness or even death.
• 2:30
  Speaker 2: Spirits on sale for thirty five dollars. It's a price
• 2:33
  Speaker 2: that's hard to resist. But what's inside the bottle could
• 2:37
  Speaker 2: cost you more. This is not fit for human consumption.
• 2:40
  Speaker 3: Nobody should be drinking.
• 2:41
  Speaker 1: This dirt, cheap and toxic. I'm worried by the prevalence
• 2:46
  Speaker 1: of this, really, really worried about it. Organized crime isn't ideological.
• 2:50
  Speaker 1: It follows money. Whenever governments create a very large gap
• 2:53
  Speaker 1: between the legal price and the untaxed price, criminals see
• 2:57
  Speaker 1: an opportunity. That's just economics. If the profit margin becomes
• 3:01
  Speaker 1: large enough, somebody will step in to supply the demand.
• 3:06
  Speaker 1: None of this means alcohol should be tax free. Excessive
• 3:09
  Speaker 1: drinking creates enormous health and social cost to the community.
• 3:12
  Speaker 1: Governments have a duty to discourage harmful consumption. However, at
• 3:17
  Speaker 1: what point does taxation stop discouraging consumption and begin to
• 3:21
  Speaker 1: encourage organized crime. We've already seen this with tobacco. Do
• 3:25
  Speaker 1: we really want to repeat the experiment? The Australian Taxation
• 3:29
  Speaker 1: Office estimates sly grod could be as worth as much
• 3:32
  Speaker 1: as one billion dollars a year, with most of it
• 3:35
  Speaker 1: involving illegally produced or counterfeit spirits. Counterfeit whiskey, vodka and
• 3:41
  Speaker 1: other premium spirits are being sold through seemingly legitimate outlets,
• 3:45
  Speaker 1: often in bottles that look genuine. The consumer may have
• 3:48
  Speaker 1: no idea they're buying an illegal product. They're just saying,
• 3:51
  Speaker 1: look at the bargain I'm getting.
• 3:53
  Speaker 3: We've been to just about two hundred stores across kind
• 3:56
  Speaker 3: of the eastern seaboard of Australia, so New South Wales, Victoria, Queensland,
• 4:01
  Speaker 3: and thirty percent of the stores we've gone to were
• 4:03
  Speaker 3: actually stocking a lite alcohol products seems to be quite widespread.
• 4:08
  Speaker 1: Over the past year, authorities have uncovered illegal distilleries, seize
• 4:13
  Speaker 1: counter of its spirits, and dismantled operations manufacturing alcohol without
• 4:17
  Speaker 1: paying excise. This isn't just about tax evasion. Elicit alcohol
• 4:22
  Speaker 1: can contain dangerous contaminants, including toxic levels of methanol, which
• 4:26
  Speaker 1: can cause blindness or even death. The message is clear.
• 4:30
  Speaker 1: This isn't someone making a few bottles of moonshine in
• 4:32
  Speaker 1: the bush. It's an organized criminal enterprise. If this sounds familiar,
• 4:37
  Speaker 1: it should. Only this week the Australian Border Force announced
• 4:41
  Speaker 1: that in the last financial year it sees more than
• 4:44
  Speaker 1: two point two billion illegal cigarettes, five hundred and eighty
• 4:47
  Speaker 1: six tons of loose leaf tobacco and thirteen point two
• 4:51
  Speaker 1: million illicit vapes. The estimated tobacco duty to the criminals
• 4:54
  Speaker 1: tried to evade exceeded four point seven billion dollars. That's
• 4:59
  Speaker 1: the scale of the criminal opportunity. Elicit alcohol is not
• 5:02
  Speaker 1: as big as illicit tobacco. But if we've learned nothing
• 5:05
  Speaker 1: from illegal smokes, then we'll watch another black market grow
• 5:09
  Speaker 1: before our eyes.
• 5:10
  Speaker 2: One morning, we had a note left on the front
• 5:14
  Speaker 2: of our door. We ignored this note, and six days
• 5:18
  Speaker 2: later we had a car drive through the front of
• 5:21
  Speaker 2: our building.
• 5:21
  Speaker 1: This isn't an argument for unlimited cheap alcohol. It's an
• 5:25
  Speaker 1: argument for accepting the consequences of bad policy. Tax settings
• 5:29
  Speaker 1: have become disconnected from market reality. An organized crime is
• 5:33
  Speaker 1: moving in. The people making the biggest profits aren't brewers
• 5:37
  Speaker 1: or di stellers. They're criminals who don't pay tax, don't
• 5:40
  Speaker 1: follow safety standards, and don't care what harm they called.
• 5:44
  Speaker 2: You start looking behind your back, wondering when something's going
• 5:49
  Speaker 2: to happen.
• 5:50
  Speaker 1: So what do you think. Are Australia's alcohol taxes just
• 5:53
  Speaker 1: about public health or are we beginning to create another
• 5:56
  Speaker 1: black market? I'd love to hear your thoughts. Leave a comment,
• 6:00
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• 6:07
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