On 24 October 2024, the NSW Government introduced the Public Health (Tobacco) Amendment Bill (No 2) 2024 into the Legislative Assembly to establish a positive licensing scheme for tobacco retailers and wholesalers and increase penalties for particular offences. The proposed reforms are intended to meet illicit tobacco control and public health objectives. 

This paper compares the proposed NSW scheme with all other Australian schemes. It provides a brief history of the schemes introduced in NSW in 1975 and 2008 and relevant NSW parliamentary developments before outlining the proposed NSW scheme. Recent policy and parliamentary developments at the national level and in Queensland, Victoria and South Australia are outlined before the key characteristics of all Australian schemes are compared. The paper finishes with a short section on the advantages and disadvantages of positive licensing schemes.

Key points

• While tobacco smoking rates have been falling for many years in NSW, they have stabilised over the past 3 years.
• Illicit tobacco is tobacco that has been illegally imported or grown in Australia. It is generally sold in packaging that does not include mandatory public health warnings.
• Positive licensing schemes are one regulatory instrument that can be used to meet public health and illicit tobacco control objectives. They require a person to lodge an application and pay a fee to a relevant authority to hold a tobacco licence. The licence holder may be banned from selling tobacco products.
• All Australian jurisdictions except NSW and Victoria have a positive licensing scheme for tobacco retailers and 5 (ACT, Queensland, South Australia, Tasmania and Western Australia) have a positive licensing scheme for wholesalers. In NSW, which currently has a notification scheme, the government has legislation before parliament to introduce a positive scheme for retailers and wholesalers. Victoria has committed to introducing a positive scheme for retailers and wholesalers before the end of 2024.
• Positive licensing schemes enable the government to place limits on who can sell tobacco, make it easier for them to carry out compliance and enforcement activities, and improve their ability to meet public health and illicit tobacco control objectives.
• The disadvantages of positive licensing schemes include the administrative costs for government and businesses, and licence fees, which could have a disproportionate impact on small businesses.
• The proposed NSW scheme will allow the Secretary for Health to refuse to grant or renew a licence if the applicant has been found guilty of an offence relating to the sale of tobacco products anywhere in Australia. Other key features include the requirement of a licence for each retail outlet and establishment of a register of licences.
• Australian positive licensing schemes differ in many ways. The proposed NSW scheme does not include features found elsewhere such as a specific fit and proper person test and the capacity to disqualify a person from holding a licence. When it comes to penalties for offences like selling tobacco without a licence, selling illicit tobacco and selling tobacco to a minor, the proposed NSW penalties are significantly lower than those in South Australia, which are the highest of any jurisdiction.