One in ten cigarettes smoked in the UK are illicit. That’s according to HMRC and The UK Border Force in their new tobacco smuggling strategy; “Tackling illicit tobacco: From leaf to light”. The new strategy highlights that revenue loss from illegal tobacco stands at £2.1 billion; however the Government states its medium term ambition is to “hold the cigarettes illicit market share at or below 10 per cent”.
For the 18-page HMRC document, visit gov.uk.
The authorities speak of ‘International Engagement’ — creating what they call a ‘hostile global environment’ for tobacco fraud through intelligence-sharing and policy change. As for the supply chain, the UK wants to undermine the profitability of such fraud at all points from production to retail; including hauliers, pub chains and self-storage facilities. As for people buying cheaper (because free of excise duty) cigarettes, the authorities want to change public perceptions and reduce tolerance of the fraud in the UK. And they want to get ‘tougher’ on those involved through sanctions. However, the document admits that criminal sanctions have a limited long-term deterrent on ‘career’ fraudsters. Cheap, factory-produced cigarettes have become increasingly available for large-scale smuggling, the document reports. Smaller volume, higher frequency smuggling through what the authorities term non-traditional routes has increased.
As the document points out, the crime undermines legitimate business and is dominated by internationally organised criminal groups, often involved in other crimes such as drug smuggling and people trafficking.
Most illicit cigarettes targeted on the UK are unregulated products made overseas, according to the authorities. For hand-rolling tobacco, the illicit market is evenly split between UK and non-UK brands, and counterfeits.
For the trade body the Association of Convenience Stores, ACS chief executive James Lowman said: “The new strategy and continued focus on tobacco smuggling is welcome, but we need to see more ambitious targets to cut the level of non-duty-paid tobacco market instead of just holding it at 10%. The illicit tobacco market funds criminality, damages legitimate businesses and results in a direct loss to the public purse. Government has made great strides over the last year in renewing its focus to tackle alcohol duty fraud – we need to see the same attention given to the illicit tobacco market.”
The ACS adds that it will be writing to HMRC ministers after the election to offer support for the strategy and calling for more ambitious targets. If you suspect that illicit tobacco sales are occurring in your area, call the non-emergency police 101 number or HM Revenue and Customs on 0800 595 000.
