Covid Border Closures Yield Tax Windfall

The U.K. treasury received a £1.35 billion ($1.88 billion) windfall last year as Covid-related border closures made cigarette smuggling nearly impossible, reports The Express.  

The huge rise in duty has prompted tobacco manufacturers to push for tougher sanctions on those involved in the smuggling, production and distribution of illegal cigarettes.

“Covid stripped some illegal volumes into the market, and there was a revenue bounce for the Treasury as a result,” said Ian Howell, fiscal and regulatory affairs manager for Japan Tobacco International.

“It shows how we need to tackle illicit tobacco as every illegal product that is sold takes money away from the government and the increased revenue during lockdown shows the scale of it.”

HM Revenue and Customs estimates that the sale of illegal tobacco products has resulted in a tax revenue loss of more than £47 billion since 2000.

An HMRC spokesman said the agency would continue to work with authorities to tackle the illicit tobacco trade problem.