The Association of Convenience Stores (ACS) has called on the UK government to provide clarity on the new EU track and trace requirements for tobacco products. The government has said that there will be no fees associated with the application process for the codes, but there is still a lack of clarity over the time that retailers will be given to apply for the codes, and there are still “unanswered questions” about the operation of the regulations. Read More
Talking Retail reports on a new study highlighting the impact of plain packaging regulation in the UK on the one year anniversary of its introduction. The study shows that 58% of retailers are aware of fake (counterfeit) plain packaged tobacco products being sold in their local area, while 72% believe that there is more illegal or very cheap tobacco sold in their local area than before plain packaging was introduced. Read More
A new report from the Institute of Economic Affairs attacks the disastrous practice of governments using sin taxes to change the behaviour of their citizens. The report follows a joint call from Michael Bloomberg and the WHO to use “intelligent taxation” to raise the price of products such as tobacco. Such taxation, the IEA argues, is regressive and far overreaches the proper competencies of the State. Read More
Il Sole 24 Ore reports that countries such as Belarus and Ukraine are key routes for cigarettes smuggled into Italy. Experts stress that smuggling would not be possible if it were not combined with a high rate of corruption in the public institutions of many eastern countries. Another main route for ‘cheap whites’ entering the country is through Libya, due to its unstable political situation. Cigarette smuggling costs EU member states €10 billion a year. Read More
The Council of the EU meets today to discuss the reform of the EU’s Comitology system for secondary legislation. The reform, aimed at increasing the accountability of national governments within the Appeal Committee stage of the Comitology process, is an attempt to fix a system that is widely seen as structurally problematic in its lack of transparency. Read More
The Observador reports this week that consumption of contraband tobacco is increasing in Portugal. The Portuguese state loses an estimated €100 million annually in tobacco tax revenue due to smuggling. The second-in-command of Portugal’s anti-tax unit, Lieutenant Colonel Paulo Messias, told reporters that seizures and infractions are increasing, and Portugal is evolving from a mainly production and transit route for illegal tobacco to a market for consumption. Read More
The Grocer reports this week that the UK Association of Convenience Stores (ACS) has called for tougher sanctions and closer collaboration to tackle illicit alcohol and tobacco trade. The ACS said illicit trade has hit the convenience sector by undercutting prices and driving footfall away from stores, thereby harming local businesses and putting local jobs at risk. Read More
Political negotiations on how to update and strengthen the EU’s lobbying transparency register began this week. Representatives from the European Parliament, the Council of the European Union and the European Commission met to discuss how to improve the EU’s rules around lobbying and interest representation. Read More
Portugal this week became the latest European country forced to take robust law enforcement action against smugglers of illegal tobacco. Portuguese police said they have arrested the leader of a tobacco smuggling gang and seized 1.2 million cigarettes in Porto and Aveiro, both in the north of Portugal. The police also said that a total of 10 individuals and two companies had been charged in connection with the smuggling. Read More
The customs authority in Dijon announced a large scale seizure of smuggled tobacco this week. The tobacco had been brought in from Germany, where prices are lower. Dijon customs said that the gradual rise in the price of tobacco in France, which started this month and is expected to result in a €10 pack of cigarettes by 2020, makes smuggling from some neighbouring countries more attractive. French customs seized 238 tonnes of contraband tobacco in 2017. Read More
An obvious correlation exists between the highest levels of illegal and non-domestic consumption (e.g. France, UK, Ireland, Poland and Finland) and the highest taxation rates applied to fine-cut toconsbacco, in comparison with cigarettes. The figures clearly show that any alignment of tobacco taxation, regardless of the products’ specificities, will prevent fine-cut tobacco from fulfilling its buffer function, leading to increased illegal trade of cigarettes and driving down government revenues.
Read more about the relationship between tax and illegal trade