Alarming rise of cheap, illicit cigarettes in SA shops
'We understand the resource constraints holding back the law enforcement agencies in our country and appreciate their attempts to clamp down on the illicit tobacco trade. However, the continued growth in the illicit tobacco trade, despite an increase in reports of interceptions and seizures, shows that the current approach is making no headway.
'There are a few relatively straightforward and cost-effective interventions that would have a significant impact. Deploying customs officials at factories, as was done successfully in 2019 before being discontinued, would ensure production volumes match quantities declared for tax purposes,' said Moloto.
Batsa also called for the urgent introduction into the Customs & Excise Act of a minimum retail price (MRP) of R37 per pack of 20 cigarettes, which is an economically viable price when considering all taxes and the lowest costs and margins in the legitimate supply chain.
'This would make it illegal to sell cigarettes below the MRP, providing law enforcement with a simple, effective tool to identify non-compliant products. Additionally, manufacturing licences should be revoked for companies found to be consistently under-declaring their production volumes or engaging in tax evasion.'
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