Australian and Chinese authorities have joined forces to dismantle a major international tobacco-smuggling operation, highlighting the growing scale of Australia’s illicit cigarette market.

The joint investigation resulted in the seizure of more than 60 million cigarettes and 60 kilograms of loose tobacco, with the products valued at more than A$92 million in avoided taxes.

Australian Border Force said Chinese authorities provided intelligence about 112 shipping containers suspected of carrying illegal tobacco. Of those, 91 containers were found to contain illicit tobacco. More than 60 people have reportedly been arrested in China in connection with the syndicate.

Investigators believe the tobacco was manufactured and transported through Southeast Asia before being concealed among legitimate commercial cargo. Some shipments reportedly left Shanghai disguised among goods including printers and lamps before arriving in Australia, particularly through Sydney.

The operation comes as Australia faces a dramatic expansion of its illegal tobacco market. Estimates cited by authorities suggest that illicit tobacco and nicotine products now account for around 80 per cent of tobacco consumption, compared with about 12 per cent in 2017.

The surge has intensified political debate over Australia’s tobacco excise. The tax has risen to around A$1.55 per cigarette, making legal cigarettes among the most expensive in the world. Critics argue that high prices are encouraging consumers towards the black market, while the federal government maintains that cutting the tax would not eliminate organised crime.

The financial consequences are significant. Australia’s May budget forecast an estimated A$8 billion shortfall in tobacco-tax revenue over five years.

Authorities say the latest operation demonstrates why international intelligence-sharing is becoming increasingly important in tackling organised crime before illegal goods reach national borders.

The case also shows how a seemingly domestic issue, the price of cigarettes has evolved into a complex international trade, taxation and organised-crime challenge.