Illicit cigarettes flooding SA’s borders

Counterfeit cigarettes are among the illicit goods most likely to be smuggled across South   Africa’s borders on a daily basis, according to a Mondaq story.

The story said that the illicit trade in counterfeit and genuine cigarettes had grown at a “phenomenal pace” and that cigarettes now comprised one of the most prevalent and problematic counterfeited items available on the black market.

Low production costs and high levels of demand had made counterfeit cigarettes one of the region’s most trafficked goods, with some reports recording that the trade in illegal cigarettes had outgrown sales of narcotics.

Every year, over ZAR4 billion in tax revenue was “lost” to sales of counterfeit cigarettes.

According to the Tobacco Institute of Southern Africa, more than 60 percent of all counterfeit cigarettes originate in Zimbabwe, partly due to poor border controls between the two countries.

Packs of counterfeit cigarettes are sold for about ZAR10 a pack, while packs of licit cigarettes retail for about ZAR30.

The story is at odds with a study published at tobaccocontrol.bmj.com a month ago, which found that, with the exception of 2010, there was no evidence that the illicit trade in cigarettes in South Africa was significantly undermining government revenue.

“Claims that illicit trade has consistently increased over the past 15 years, and has continued its sharp increase since 2010, are not supported,” the study concluded.