Participants included the Tobacco Institute of South Africa, the Fair Trade Independent Tobacco Institute, National Treasury (NT), South African Revenue Service (SARS), Financial Intelligence Centre (FIC), the Hawks and the National Prosecuting Authority (NPA).
Members of the committee are acutely aware of the health hazards of smoking but since smoking is not legally proscribed, the committee feels very strongly that SARS should raise the full revenue it is entitled to from the tobacco industry.
The committee believes that every cent due to SARS has to be collected, especially in view of the revenue shortfalls in recent years and the need to fund major pro-poor programmes.
Yunus Carrim, chairperson of the committee, said that R5 billion is already lost to the fiscus, which is totally unacceptable.
He stated that South Africa ranks under the top five countries in the world with the highest incidence of trade in illicit cigarettes.
The committee believes that there should be far more effective coordination between SARS, the Hawks, the FIC, the NPA and the National treasury to decisively tackle the illicit trade.
According to Tobacco South Africa’s information, illicit trade means the supply, distribution and sale of smuggled or counterfeit tobacco products on which the necessary duties and taxes have not been paid.
These products are either imported for commercial use but duties, excise and value-added tax are not paid, according to their information. Other forms are undeclared locally produced products or counterfeits.
Illegal packaging usually has no excise stamp on it, no diamond SA stamp, no health warnings, the quit hotline number is incorrect or missing, the tar and nicotine readings are higher than normal — more than 12 mg tar or more than 1,2 mg nicotine — and the words “reduced ignition propensity” is not printed on the pack, according to their information.
The excise duty on a pack of 20’s alone is R15,52 as of March 2018.
Police in Bela-Bela along with the department of economic development, environment and tourism have recently been cracking down on unregulated businesses, stating that businesses must register in order to conduct business legally and that street hawkers must apply for permits at the local municipality.
Lieutenant Colonel Abel Phetla, head of the detective branch in Bela-Bela, said there has not been many cases of illicit trade within the area, but if people suspect others of this, they are to phone the police at (014) 736 9760/1.
People can also call the SARS fraud and anti-corruption hotline at tel. 0800 00 28 70.
