FITA slams Tax Justice SA’s ‘concocted findings’ in illicit cigarette trade probe

Fair-trade Independent Tobacco Association (FITA) has distanced itself from Tax Justice South Africa (SA) and slammed it’s investigation, which revealed that shops throughout the country were selling cigarettes that evade due taxes.

Tax Justice SA conducted an undercover investigation into the country’s illicit cigarette trade by visiting shops across Cape Town, Durban, Johannesburg and Pretoria.

“We bought cigarettes costing a third of the minimum legal price. A pack of Red & Black cost us R7.20. The producer Afroberg, a member of FITA, should pay R17.40 excise to government on every pack. How was our purchase legally possible?” Tax Justice SA claimed on Twitter.

READ MORE: FITA welcomes tobacco ruling, bemoans surge in illicit cigarette trade

In all but one of the 43 shops we visited in CPT, Durban, Joburg and Pretoria we bought cigarettes at below the minimum tax level of R20.01. These illicit cigarettes were on open display and vendors had no fear of being caught.@SAPoliceService @sarstax pic.twitter.com/PfTjhmjYht

— Tax Justice South Africa (@TaxJustice_SA) January 20, 2021

“We bought 34 different brands of these illicit cigarettes. Two-thirds of these brands are made by members of FITA or its former member Gold Leaf. How can these companies be paying taxes if their products are being sold at a fraction of what’s due SARS (South African Revenue Service),” the organisation further said.

All our buys were filmed and a full dossier of evidence has been handed to @sapoliceservice @DrZweliMkhize @EdKieswetter @the_dti. We need urgent action to stop this industrial-scale looting of funds that should be saving lives and rebuilding our nation.#LockThemUp #TJSAexpose pic.twitter.com/vgSupGuLxT

— Tax Justice South Africa (@TaxJustice_SA) January 20, 2021

Meanwhile, in a statement on Wednesday, 20 January, FITA rejected Tax Justice SA’s “concocted findings” with contempt.

“We are further not surprised by the opportunistic and choreographed statements issued thereafter from organisations which appear to be nothing more than lapdogs of Big Tobacco,” FITA chairperson Sinenhlanhla Mnguni said.

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Mnguni noted that the majority of the cigarette brands mentioned by Tax Justice SA were not current members of FITA.

“We therefore suggest that any queries incidental thereto be directed at the correct parties.

“It comes as no surprise that this latest attack on FITA and its members comes not too long after a similar attack from another front-group of Big Tobacco which was directed at local cigarette manufacturers, and it clearly forms part of a new campaign by Big Tobacco to try and maintain a hold on its shrinking market share following the failure of the #TakeBackTheTax campaign which was exposed by the media for the astroturfing campaign that it was,” Mnguni said.

Read the full statement below:

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