Sars eyes Illegal tobacco traders

2013-11-24 14:26

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Johannesburg - Sars is set to clamp down on illicit tobacco trade around the country in a bid to recover more than R400m in unpaid taxes.

According to the Sunday Times, Johannesburg-based tobacco manufacturer Carnilinx is also under Sars’ spotlight for allegedly spying on, bribing and threatening its investigators.

Carnilinx allegedly hired private investigators to spy on Sars investigators, police and state security operations in a bid to halt probes into its tax affairs.

According to a research study, 1.12bn packs of legal cigarettes have been sold in South Africa this year while an additional 340 million packs of illegal cigarettes have also been sold, costing the national treasury billions, say the Tobacco Industry of Southern Africa.

Illegal cigarettes

This in itself created “unfair competition” for the legitimate tobacco industry and leads to an increase in smoking, Tisa said.

If the industry estimates are added to government data on legal sales, it shows a “massive increase” in smoking – not the steady decline most stakeholders assume is happening, according to Cornelius van Walbeek, an associate professor at the University of Cape Town’s school of economics and head of the school’s economics of tobacco control project.

The research done for Tisa is “in principle, very plausible”, said Van Walbeek.

It entails surveys of cigarette-buying customers at retail outlets, including buying packets of cigarettes from smokers in order to inspect and test them for signs of illegality.

Van Walbeek said his own research indicates that there was a “pretty significant spike” in illicit trade in 2010.

In 2008, Tisa estimated that 6% of cigarettes were illegal and that rose to 21% in 2010.

Last year, it jumped to 30%.

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