However, Labour police spokesman Stuart Nash told the Herald the committee "did have a look at [illegal] arms or firearms importing".
"Yes it might go on, but the real problem is people stealing firearms from licensed dealers.
"We discussed, with police and Customs, about what were the chances of firearms being illegally imported into New Zealand? And what Customs told us was, while they obviously can't check every container, it would be very difficult."
Pistols and military-style guns can be legally imported by licensed dealers, but Nash said the weapons, if ever used for illegal purposes, would be easily traced by authorities.
"Good luck to you, but you're going to be out of business and we're going to catch you," he warned any would-be illegal arms importers.
The committee, which made 20 recommendations, wants the Arms Act changed "to clearly state that a gang member or prospect must not be considered a fit and proper person to possess firearms and therefore must not hold a firearms licence".
Cahill praised the proposed tougher stance for gang members, as did Police Minister and Deputy Prime Minister Paula Bennett.
Nash said the report found of more than 3900 patched gang members and prospects, some 44 per cent had been charged with a firearms offence.
Of those, 9 per cent had been charged with five or more firearms offences, he said.
Cahill added, gang members and prospects demonstrated every day of the week they were not fit to own a firearm.
"We know of gang members who are licensed firearms carriers and currently there is nothing to stop them purchasing any number of weapons, and then distributing them among the gang."
Cahill said the report also produced some "good, common sense recommendations" which answer several concerns.
"We are particularly pleased with the recommendation that the permit to procure a firearm be extended to cover the sale or transfer of all firearms," he said.
He said, the committee noted the process would provide details of firearms transactions to the police, and over time, build a firearms database.
"The committee members have recognised that this permit regime would initially impose an administrative burden on buyers, sellers and the police, but it is time to focus on the bigger picture," Cahill said.
"New Zealand needs to better monitor private sales of firearms and the majority of the country's 242,000 licensed owners will agree with that. An online process for permits will eventually reduce the costs to all."
In this month's Police News magazine, Cahill wrote, "gun ownership is not a right, it is a privilege".
"I am briefed daily about [police] being either confronted with firearms or finding them in situations that could easily turn deadly. In several cases, it has simply been good luck that a [police officer] has not been seriously injured or killed."
New Zealand First said it agreed with some committee's recommendations, but felt the report targeted legitimate gun owners and dealers.
"The report centres on a stated presumption that theft from legitimate owners is the major source of illegal firearms falling into criminal hands, despite a clear lack of any tangible evidence supporting this claim," NZ First stated.
"The report fails completely to address the manifestly inadequate rate at which the police either solve, or even investigate, reported thefts of firearms from legitimate owners."
The committee opted against a recommendation to create a firearms register, instead backing a law change to require police to record serial numbers of firearms when licence holders renew their licences, or have their premises inspected.
It recommended the law be amended so a firearms licence is needed to possess ammunition, unless the person with the ammunition is under the immediate supervision of a firearms licence holder. Dealers should be made to keep records of ammunition sales, it read.
Firearms prohibition orders should be introduced in New Zealand, the report also recommends, and people who lose their firearms licence should be subjected to a stand-down period before reapplying.
Last year all parties in Parliament backed the establishment of the inquiry, after the shooting of four police officers in Kawerau last year, and the discovery of a cache of guns was found stashed in the ceiling of a South Auckland home, including 14 military-style guns, among them AK47s and M16s.
