TOBACCO industry claims that international crime gangs are flooding Australia with smuggled cigarettes, or ''chop chop'', are being investigated by the competition watchdog.

TOBACCO industry claims that international crime gangs are flooding Australia with smuggled cigarettes, or ''chop chop'', are being investigated by the competition watchdog.

But the allegations have been emphatically denied by Customs and Border Protection.

The claims are part of a campaign against the Gillard government's plan to introduce plain packaging for cigarettes, which is expected to culminate in a constitutional challenge in the High Court of Australia.

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British American Tobacco Australia chief executive David Crow warned last week that plain cigarette packets would provide a ''field day'' for organised criminals, who had profited from a 150 per cent increase in illegal tobacco in Australia over the past three years.

But Home Affairs Minister Brendan O'Connor, who is responsible for customs, accused the powerful tobacco lobby of scaremongering to protect its commercial interests.

''It is baseless to claim that one in six smokers [is] consuming illegally imported tobacco,'' Mr O'Connor said.

''Big tobacco regularly quotes from reports that it commissions itself - rather than the independent research - because independent research does not back its claims.''

He referred to the 2007 National Drug Strategy Household Survey that found only 0.2 per cent of the population, about 33,000 people, used illegal tobacco products more than half the time they smoked.

Opposition Leader Tony Abbott has said he would support any move to curb smoking rates, but he has refused to back the government's proposal. ''My anxiety with this [plain packaging proposal] is that it may end up being counterproductive in practice,'' he said.

But Liberal MP Mal Washer broke ranks with his leader when contacted by The Sunday Age last week. Dr Washer, who spent 26 years as a medical practitioner before moving into federal politics, gave a blunt assessment of the tobacco industry's strategy.

''All this talk of chop chop and crime gangs sounds like bullshit to me. The tobacco industry is jumping up and down because they're worried about their businesses. I support these reforms unequivocally and whatever my party decides to do, I don't give a shit,'' Dr Washer said.

He said smoking killed about 19,000 Australians each year, and governments had a moral responsibility to implement any measure that could stop young people from taking up the habit.

The Alliance of Australian Retailers, set up and funded by Australia's three biggest tobacco firms, recently ran nationwide ads that claimed more children would smoke illegal tobacco if plain packaging was introduced.

Anti-cancer groups have asked the Australian Competition and Consumer Commission to investigate the campaign, which was branded ''misleading and deceptive'', by Quit Victoria executive director Fiona Sharkie.

Ms Sharkie said the AAR should focus on its own members who have been caught selling cigarettes to minors. A Melbourne City Council inspection found almost a third of inner-city tobacco retailers sold cigarettes to children.

The AAR's Craig Glasby defended the ads, saying the federal government's own survey indicated some teenagers ''have smoked unbranded tobacco''. He said plain packaging would make it easier for crime gangs to produce counterfeit packs.

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