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Category: Illicit Trade

  • Philippines to Use Tobacco Products to Raise More Tax Money in 2026

    Philippines to Use Tobacco Products to Raise More Tax Money in 2026

    The Philippines’ Bureau of Internal Revenue (BIR) is looking to increase excise tax collections by 9.35% in 2026, mainly driven by tobacco products. In the 2026 Budget of Expenditures and Sources of Financing (BESF), the government is set to collect P359.65 billion ($6.1 billion) in excise taxes on selected goods, including P166.57 billion ($2.8 billion) from tobacco products.

    BIR Commissioner Romeo D. Lumagui, Jr. said in addition to Health department’s campaign to discourage tobacco use, the government loses an estimated P114 billion ($2 billion) in revenues due to illicit tobacco trade. He said illicit tobacco manufacturers are using economic zones to avoid paying excise taxes even though the products are sold in the Philippines.

    “If it’s meant for export and not for local consumption, there’s no excise tax,” Lumagui said. “It’s being manufactured here in the ecozones. That’s what they’re trying to show — that the license they’re getting is for exporting all these products.”  

  • China’s Crackdown Chokes Off N. Korean Cigarette Smuggling

    China’s Crackdown Chokes Off N. Korean Cigarette Smuggling

    North Korea’s once-lucrative cigarette smuggling operations into China have ground to a halt after Beijing launched a sweeping crackdown on illicit tobacco distribution, officials said. Daily NK sources said Chinese police and the State Tobacco Monopoly Administration arrested traders, confiscated contraband, and tracked deliveries via firms like SF Express and ZTO Express since August 3. The clampdown left major North Korean firms, including Korea Sinhung Trading Corp. and Amrokgang Tobacco Co., scrambling for new foreign currency sources.

    Chinese partners have suspended dealings, fearing heavy fines and confiscations. “Activities to earn foreign currency through cigarette smuggling run into trouble as Chinese traders quit the business all at once,” one North Korean source said.

    With distribution channels collapsing, Pyongyang’s trading companies are now under pressure to find alternative exports. Traders in China say the current campaign is harsher and longer-lasting than past crackdowns, raising doubts about the future of North Korea’s tobacco trade.

  • Bangladesh Customs Busts Cigarette Paper Smuggling Racket

    Bangladesh Customs Busts Cigarette Paper Smuggling Racket

    Customs officials in Bangladesh seized two consignments of undeclared cigarette paper falsely labeled as straw paper and paper ribbon, exposing a racket that could cost the government hundreds of crores in lost revenue. Lab tests by BUET, Dhaka University, and Khulna University of Engineering and Technology confirmed the shipments contained cigarette paper, not the reported goods.

    Officials said Dhaka-based RM Enterprise and Smart Move attempted to clear the goods despite laboratory findings, allegedly lobbying senior revenue officials. If released, the consignments would have deprived the state of Tk 1.7 crore ($139,000) in duties and up to Tk 135 crore ($11.1 million) in VAT from untaxed cigarettes.

    Records show RM Enterprise previously imported 489 tons of raw materials under suspicious declarations, with potential tax losses estimated at Tk 4,000 crore ($329 million). Both firms were found to be operating through non-existent or front addresses.

    Customs officials have blocked the release of the seized shipments and vowed further investigation into past imports.

  • 75 Tax Evasion Cases Filed in Philippines Crackdown

    75 Tax Evasion Cases Filed in Philippines Crackdown

    The Bureau of Internal Revenue (BIR) in the Philippines filed 75 tax evasion complaints against vape retailers nationwide, accusing them of evading a combined ₱711.3 million ($12.8 million) in taxes by selling smuggled and unstamped products.

    BIR Commissioner Romeo Lumagui Jr. said the cases, lodged with the Department of Justice today (August 20), involve violations ranging from unpaid excise duties to failure to file tax returns. The crackdown follows earlier billion-peso cases against major brands like Flava, Denkat, Flare, and Tap Fog.

    “The government loses billions from illicit vape sales — money that should fund health care and infrastructure,” Lumagui said, vowing continued action against both big and small operators.

  • Dog Helps Seize £200K of Illegal Tobacco and Vapes in U.K.

    Dog Helps Seize £200K of Illegal Tobacco and Vapes in U.K.

    A specially trained dog helped authorities uncover a major haul of illegal tobacco and vaping products in a raid in Dunstable, U.K. Leo, from Specialist K9’s Limited, assisted Central Bedfordshire Council’s trading standards team, HMRC, and Bedfordshire Police in locating nearly 300,000 illegal cigarettes, 11.3 kg of hand-rolling tobacco, and 303 disposable vapes. A nearby flat, accessed via keys carried by a man found at the shop, held a “significant quantity of illicit goods,” bringing the total value of seized items to around £200,000.

    John Baker, Independent executive councilor for finance and highways, said the operation highlighted the risks posed to public health and legitimate businesses by the sale of illicit products. “We will continue to take firm action against those who break the law,” he said.

  • Silk Group Chair Charged in Nepal with $126M Vape Smuggling Case

    Silk Group Chair Charged in Nepal with $126M Vape Smuggling Case

    Nepal’s Department of Revenue Investigation (DRI) filed a case against 12 individuals, including Silk Group chairperson Ramesh Sherpa, over alleged involvement in the large-scale smuggling of Chinese electronic cigarettes. The case, lodged at the Lalitpur District Court on August 14, seeks prison terms and fines totaling nearly Rs17.5 billion ($126 million).

    Investigators allege the group used about 100 shipping containers to import vapes disguised as legitimate goods through the Tatopani customs point, bypassing the government’s import ban. A January raid on a Silk warehouse in Sitallheight seized 86,400 vapes, with further evidence collected from company sites in Balkumari and Naxal. Authorities claim Sherpa and his associates fabricated records, created fake transactions, and sold nearly 39,000 vapes without bills, leading to estimated revenue losses of Rs873 million ($6.3 million).

    The DRI has demanded maximum prison terms for Sherpa, his brother-in-law Vijay Sherpa, and other key defendants, while seeking reduced sentences for two secondary accomplices. Officials say the total recovery sought exceeds Rs1.74 billion ($12.5 million), and investigations are continuing, with some seized shipments still held at Tatopani customs warehouses.

  • Queensland Seizes 45M Cigarettes, 350K Vapes in Black Market Crackdown

    Queensland Seizes 45M Cigarettes, 350K Vapes in Black Market Crackdown

    Queensland Health (Australia) seized 45 million illegal cigarettes, 350,000 vapes, and over six tons of loose-leaf tobacco since November 2024, as part of a statewide crackdown on the illicit tobacco trade. Authorities say new laws introduced in May have strengthened penalties and enforcement powers, aiming to dismantle the growing illicit tobacco network.

    The surge in black market activity comes despite recent government efforts to tighten enforcement. A 2024 Brisbane Times investigation found widespread illegal sales across Brisbane, with foreign brands like Manchester, Double Happiness, and ESSE openly sold at half the price of legal products.

  • BAT Warns Ireland Could Become Smuggling Hotspot

    BAT Warns Ireland Could Become Smuggling Hotspot

    British American Tobacco urged the Irish government to fast-track enforcement measures alongside the delayed excise tax on vaping products, warning that weak oversight could further fuel the country’s growing illicit vape market. David Melinn, BAT Ireland’s country manager, said the Health Service Executive’s plan for just 40 annual inspections is “not sufficient” given the scale of the market. Citing a KPMG report, BAT claims illicit vapes now make up 34–45% of Ireland’s €550 million vape market.

    The industry is pushing for a tax stamp regime to help curb black market activity. Without it, BAT warns, Ireland risks becoming an even more attractive hub for criminal smuggling—especially as a vape flavor ban also looms. BAT says strong enforcement is critical to protect public health and ensure legal market stability.

  • South African Court Allows Seizures of Tobacco Smuggling Trucks

    South African Court Allows Seizures of Tobacco Smuggling Trucks

    South Africa’s Hawks (a specialized police unit) and the National Prosecuting Authority’s Asset Forfeiture Unit (AFU) secured high court orders to seize vehicles used in the smuggling of illicit cigarettes from Zimbabwe, marking a significant step in efforts to curb cross-border tobacco crime.

    The Limpopo High Court granted a forfeiture order for a Freightliner Argosy truck and two trailers, intercepted at Beitbridge border post in March while carrying Zimbabwean-made cigarettes. The vehicles, worth $48,000, were confiscated after the arrest of the driver. In a separate case, authorities also secured a forfeiture order for a VW bus valued at $9,100 in a 2023 case of transporting illicit cigarettes.

    Officials say one-third of the cigarettes in South Africa are smuggled from Zimbabwe. Smugglers reportedly buy cigarette boxes for $120 in Zimbabwe and resell them for up to $840 in South Africa. Authorities have pledged continued action against smugglers, as tobacco tax evasion and black-market sales remain a major challenge to public health and revenue collection.

  • Hong Kong Customs Being Overwhelmed by Smuggled Cigarettes

    Hong Kong Customs Being Overwhelmed by Smuggled Cigarettes

    Hong Kong Customs reported a sharp rise in cigarette smuggling this year, seizing 200 million illicit cigarettes worth HK$1 billion ($130 million) in the first five months, a fourfold increase from the same period in 2024.

    Customs Commissioner Chan Tsz-tat attributed the surge to well-organized smuggling networks exploiting cross-border travel. Last year saw about 19,000 smuggling cases by travelers; this number is expected to surpass 30,000 in 2025.

    To combat the problem, customs plans to intensify efforts to dismantle the entire smuggling supply chain—from transportation to retail—and increase awareness campaigns at key border crossings. Under Hong Kong law, travelers are allowed to bring in only 19 cigarettes duty-free per person.

    In addition, the agency faces a significant backlog in disposing of seized narcotics, with over 100 tons in storage. Current destruction processes could take up to 35 years, prompting authorities to explore faster methods, including streamlined procedures and a dedicated armed escort team.

    Hong Kong Customs is also collaborating with mainland e-commerce platforms like Taobao and Pinduoduo to block sales and shipments of banned goods, although differing laws between Hong Kong and mainland China present ongoing challenges.