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Tag: illicit tobacco

  • Pakistan Battling Illicit Cigarettes as Farmers Seek Balance

    Pakistan Battling Illicit Cigarettes as Farmers Seek Balance

    Pakistan is intensifying efforts to tackle distortions in its tobacco sector, combining a nationwide crackdown on illicit cigarettes with growing provincial demands for fiscal reforms. Finance Minister Bilal Azhar Kayani announced enforcement actions targeting illegal manufacturers and retailers, alongside track-and-trace systems and stronger tax oversight, noting the illicit market costs around Rs200 billion ($720 million) annually and now exceeds 50% of total consumption (43.5 billion sticks), with cheaper untaxed products undercutting legal sales.

    At the same time, lawmakers in Khyber Pakhtunkhwa are pushing to tax the transport of locally grown tobacco to other regions, arguing the province — despite producing about 98% of Pakistan’s flue-cured Virginia tobacco — captures little value due to cigarette manufacturing being concentrated in tax-free zones elsewhere. Officials say the imbalance is fueling unemployment and farmer losses, underscoring calls for coordinated policy measures to restore fair taxation and economic returns across the supply chain.

  • NZ Retailers Want Crackdown to Avoid Australia’s Illicit Tobacco Crisis

    NZ Retailers Want Crackdown to Avoid Australia’s Illicit Tobacco Crisis

    Retail NZ is calling for the government to establish an urgent multi-agency task force to combat the growing illicit tobacco trade, warning that New Zealand risks facing the kind of organized crime activity seen in Australia if enforcement is not strengthened. In a report released April 13, Chief Executive Carolyn Young said black-market cigarettes are now being sold openly in some Auckland shops at steep discounts, undermining tobacco control measures and exposing retailers to criminal pressure.

    Retail NZ is urging coordination between police, customs, and the Ministry of Health, tougher penalties, and an independent roundtable to address the issue, noting that current enforcement is fragmented and sanctions remain low. Under existing law, selling illicit cigarettes can carry penalties of up to six months’ imprisonment or a NZ$20,000 ($11,800) fine, while importing tobacco without paying excise duty violates customs regulations.

  • Weak Illicit Cigarette Enforcement Drains $1.1B in Pakistan

    Weak Illicit Cigarette Enforcement Drains $1.1B in Pakistan

    Pakistan is losing more than Rs300 billion ($1.1 billion) each year to the illegal cigarette trade due to weak enforcement against illicit manufacturing and smuggling, according to macroeconomic analyst Osama Siddiqui. He said effective action in the tobacco sector could significantly reduce the country’s widening revenue gap.

    The shortfall comes as fiscal pressures mount. The Federal Board of Revenue missed its March target by Rs185 billion ($666 million), collecting Rs1,182 billion ($4.3 billion) against a goal of Rs1,367 billion ($4.9 billion) — just a 6% year-on-year increase versus the 21% growth required. Meanwhile, the government is trimming development spending to fund fuel relief, while facing pressure from the International Monetary Fund to withdraw tax exemptions.

    Siddiqui argued that instead of raising taxes on already compliant sectors, authorities should prioritize curbing tax evasion in tobacco through stricter action against illegal production and smuggling, full implementation of track-and-trace systems, and tighter retail monitoring. He said plugging these leakages could create fiscal space for public relief and development spending at a time of heightened economic strain.

  • S. Africa Trying to Flip ‘Inadequate’ Illicit Tobacco Response

    S. Africa Trying to Flip ‘Inadequate’ Illicit Tobacco Response

    South Africa’s response to illicit tobacco remains inadequate, with legislative gaps, weak enforcement, and entrenched criminal networks that have been flourishing since the Covid-19 cigarette ban, Stefano Betti of the Transnational Alliance to Combat Illicit Trade said at the EMEA Security Conference in Cape Town. He said illicit cigarettes may now account for between 50% and 75% of the market, driven largely by local under-declaration of production to evade taxes, creating severe price distortions between legal and illegal products and fueling money laundering risks.

    While acknowledging progress such as the creation of the Border Management Authority, efforts by the National Prosecuting Authority, and South Africa’s exit from the Financial Action Task Force grey list, Betti stressed that political commitments must translate into operational results. Echoing the call for stronger action, Kobus Lategan of the South African Police Service said authorities are preparing a large, intelligence-led national operation under direction from Cyril Ramaphosa to target illicit trade and counterfeit goods through coordinated enforcement across agencies and with private-sector support.

  • Philippines Bust Seizes $23M in Illicit Vape Products

    Philippines Bust Seizes $23M in Illicit Vape Products

    The Philippines Department of Trade and Industry and the Bureau of Customs seized P1.4 billion ($23.3 million) worth of illegal vaporized nicotine products in a warehouse raid in San Rafael Village, Navotas City, confiscating over 3.2 million vape devices and pods along with branded promotional items. The shipments lacked Philippine Standard Licenses and Import Commodity Clearance, violating Republic Act 11900 and related Customs regulations, and are now subject to forfeiture and condemnation proceedings to prevent reentry into the market. Authorities warned that violators may face substantial fines, imprisonment, revocation of licenses, and recall of noncompliant products.

  • Philippines Calling on Locals to Curb Tobacco Smuggling

    Philippines Calling on Locals to Curb Tobacco Smuggling

    The Philippines’ National Tobacco Administration called on local government units to intensify enforcement against cigarette smuggling, which the Bureau of Internal Revenue estimates is costing the country between P40 billion and P52 billion ($680–$884 million) annually. The push follows recent seizures, including a March 17 operation in Maguindanao del Norte that recovered P6.46 million ($110,000) worth of illicit cigarettes, underscoring the scale of the problem.

    NTA Administrator Belinda S. Sanchez warned that smuggling threatens public health, government revenue, and the livelihoods of around 2.2 million farmers and workers. Authorities, including the Philippine National Police, are ramping up joint operations, with nearly P3 billion ($51 million) in illicit products seized in late 2025, while reminding retailers that violations under the Anti-Agricultural Economic Sabotage Act of 2024 can carry life imprisonment and heavy fines.

  • Facing $900M Tax Loss, Thailand Cracking Down on Illicit Tobacco

    Facing $900M Tax Loss, Thailand Cracking Down on Illicit Tobacco

    Thailand is intensifying its crackdown on illicit tobacco and e-cigarettes as authorities seek to curb revenue losses and protect public health. The Customs Department reported seizing over 27.3 million illegal cigarettes and 205,000 e-cigarettes worth more than 169 million baht ($5.1 million) in recent operations, highlighting the scale of the underground market. Officials estimate that illicit cigarettes account for around 25% of national consumption, resulting in annual tax losses exceeding 30 billion baht ($900 million), while also distorting competition for legitimate businesses and posing broader security and health risks.

    Authorities say smuggling networks continue to evolve, with Thailand acting as a key transit hub due to its extensive logistics infrastructure, and the southern border identified as a major entry point for illegal cigarettes. In response, enforcement efforts are shifting toward targeted intelligence-led operations, leveraging AI and data analytics to improve detection, alongside stricter penalties—including proposed per-unit fines for e-cigarettes—to close regulatory loopholes. The government aims to dismantle distribution networks, including online channels, while accelerating the destruction of seized products and reinforcing multi-agency cooperation to restore market integrity and safeguard tax revenues.

  • Cimabel Calls for Policy Rethink as Untaxed Tobacco Tops 44% in Belgium

    Cimabel Calls for Policy Rethink as Untaxed Tobacco Tops 44% in Belgium

    Contraband cigarette consumption in Belgium surged in 2025, with illicit and untaxed foreign products accounting for 44.4% of total consumption in Q4, up from 34.9% a year earlier, according to Cigarette Manufacturers of Belgium and Luxembourg (Cimabel). The rise contributed to an estimated €3 billion loss in excise and VAT revenues, while counterfeit cigarettes increased to 4.6% of the market, raising concerns over unregulated production and potential health risks. Most untaxed cigarettes originated from lower-price markets such as Bulgaria, Luxembourg, and Turkey, with urban areas particularly affected by high levels of illicit purchasing.

    Industry representatives attribute the growth in illegal trade to rising tobacco taxes and regulatory pressure, warning that price disparities are pushing consumers toward black market channels. Cimabel has called for a policy rethink, including harmonizing excise rates across the EU, strengthening customs enforcement, and expanding access to reduced-risk nicotine alternatives, as authorities face mounting challenges in balancing fiscal policy with illicit trade control.

  • Australia Steps Up Illicit Tobacco Crackdown

    Australia Steps Up Illicit Tobacco Crackdown

    Australia is ramping up its response to the illicit tobacco and vape market, with plans for tougher penalties, new offences, and expanded enforcement powers targeting organized crime, according to the Australian Broadcasting Corporation. More than half of tobacco products sold are estimated to be illegal, generating between A$4.1 billion and A$6.9 billion ($2.9-$4.8 billion) for criminal groups and costing up to A$11.8 billion ($8.3 billion) in lost excise revenue. Proposed reforms include tripling jail terms, enabling asset seizures, and elevating tobacco offences to “serious crime” status.

    Former Australian Border Force officer Rohan Pike said stronger penalties would be welcome if “enforced rigorously and in a sustained way,” but cautioned that enforcement alone is insufficient. He noted excise remains an “ongoing imbalance in the market” and argued it “needs to be reviewed… to reduce the incentive for criminals,” while also highlighting the need for greater consistency across state and territory enforcement frameworks.

    Authorities said enforcement efforts would increasingly focus on disrupting domestic distribution, including shutting illegal retail outlets, penalizing landlords, and targeting online sales channels, as well as addressing the rapid growth of illicit nicotine pouch imports.

  • Surging Illicit Tobacco Market Costs Thailand $930M

    Surging Illicit Tobacco Market Costs Thailand $930M

    Thailand is losing nearly 30 billion baht ($930 million) annually to the illegal tobacco market, which now accounts for about 25% of total tobacco consumption in the country, according to a report by the EU-ASEAN Business Council. The surge in illicit trade, driven by expanded trade links and smuggling networks, is undermining state tax revenue, fair competition, and consumer safety. The government has responded with high-profile enforcement actions, including a recent operation in southern Thailand that seized over 20 million illegal tobacco items and levied fines exceeding 1 billion baht ($31 million).

    While crackdowns provide short-term relief, experts stress that a long-term solution requires system-wide measures, including strengthened supply-chain transparency, harmonized regulations, digital traceability, and regional law enforcement cooperation, to disrupt the entire illegal tobacco network.