The new Tobacco Licensing Scheme in Victoria: what retailers and wholesalers need to know

The Tobacco Amendment (Tobacco Retailer and Wholesaler Licensing  Scheme) Bill 2024 (the Bill) was passed in November 2024 by the Victorian Parliament, amending the Tobacco Act 1987 (the Act) to establish a tobacco business licensing scheme for both retailers and wholesalers (the Scheme).

Prior to the Bill, retail or wholesale sellers of tobacco products have not required a licence. The Scheme includes cigarettes, cigars, and other tobacco products designed for human consumption. E-cigarettes and vapes are not included as these products are regulated by Federal legislation.

Applications for a licence may be made from 1 July 2025. From 1 July 2026, retail or wholesale sellers of tobacco products will require a licence to legally sell tobacco.

The purpose of the Bill is twofold: Parliament considers cheap, illegal tobacco to be a key issue undermining efforts to improve the health of Victorians. The Victorian Government has stated that these changes were introduced to “help protect legitimate businesses from getting undercut from criminal syndicates”. Secondly, and more broadly, is the push to drive down rates of cardiovascular disease and other smoking related illnesses in Victoria.

Prior to this Bill, Victoria’s lack of a tobacco licencing scheme was unique. Every other Australian state and territory had already either introduced and implemented a licensing scheme or had a proposal to establish a licensing scheme before parliament. With this Bill, Victoria is catching up with the rest of the country.

The Bill establishes that tobacco can only be sold by licensed retailers similar to the structure of a liquor licence. A separate licence will be required for each venue or premises that you, as a retailer or wholesaler, intends to sell tobacco – whether over the counter, via vending machine, or otherwise. The offences under the Scheme are similar to liquor licensing offences including selling tobacco other than in accordance with the licence, failing to display the licence, holding out that a premises or person is licensed when they are not and making a false or misleading statement in relation to licensing.

The Department of Justice and Community Safety (Regulator) is the regulator of the Scheme and will determine whether an applicant is considered suitable to hold a licence. The test will rely on whether the Regulator considers the applicant to be a “fit and proper person”.

You may be refused a licence based on your prior history (including any criminal history) and any known associates of concern. The Regulator may draw upon resources and information from Victoria Police, including running criminal history checks, in the course of their suitability assessment.

Licences will run with the financial year, and as such must be renewed at the end of June each year by paying a (yet to be determined) fee as opposed to liquor licences which run the calendar year until 31 December. Licence holders must display their licence clearly in their venue, and a public register of valid licences will be accessible on the Regulator’s website.

Breaches of the new laws are punishable by severe penalties with the maximum penalty for selling tobacco products without a licence for an individual of 840 penalty units (approximately $166,000) or 5 years imprisonment and for a body corporate: 4200 penalty units (approximately $830,000). Prospective licensees have a year from 1 July 2025 to obtain a licence and familiarise themselves with their obligations under the Scheme.

A new tobacco compliance inspectorate will also be established by the Regulator and enforcement officers will be on the ground from early 2026 to ensure all premises are complying with the Scheme.

The scheme will be implemented in three stages: public consultation, licence application, and enforcement.

1. March – April 2025: Public consultation will occur, including licence categories,
2. 1 July 2025: Tobacco retailers and wholesalers may apply for and be granted a licence.
3. 1 July 2026: The Act comes into operation, and penalties will start to be enforced.

If you sell tobacco products, mark your calendars and make sure you apply for a licence when applications open in July 2025. Ensure all your premises have valid licences each year, and that they are clearly displayed on the venue premises.

Contact Terence O’Brien (terence@sanickilawyers.com.au) or Grace Madafferi (grace@sanickilawyers.com.au) of our Liquor Licensing and Hospitality Law Team for more information.

Authors: Terence O’Brien, Special Counsel and Natasha Redhill, Intern Paralegal