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SMUGGLED and counterfeit cigarettes are still flooding the market denying the nation billions of money through tax evasion and sabotaging local manufacturers. Tanzania Cigarette Company in collaboration with the National Environmental Management Council, Tanzania Revenue Authority and the police destroyed contraband and counterfeit cigarettes worth 8.5bn/- in Dar es Salaam last week. It is expected one of ten cigarettes in the market is illegal and last year the government lost approximately 30bn/- in unpaid taxes, according to the TCC Director for Company Services and Security, Frank Usiri. “This prompted TRA and police to chip in and managed to seize a lot of consignments in the market,” he said when the smuggled and counterfeit cigarette were being destroyed. He said contraband cigarettes are those that are meant for export but unscrupulous businesspeople go to those markets especially Zambia and buy back these cigarettes and sell them to the local market hence evading tax. “These are common at border areas and in other parts of the country where they find their way through the black market,” he said. With counterfeits some business people have set up manufacturing plants and are producing similar products and are not paying tax and also risking people’s lives as the fake products do not meet the required standards, he said. “These products do not undergo any quality control tests hence are a major risk to consumers,” he said. “The other thing is if you look at these counterfeits, they all have a batch stamp with the same number while each stamp is supposed to have a different number meaning the government is losing a lot and it is also sabotage to the genuine manufacturers who have invested heavily only for these saboteurs to take advantage,” he said. He said the destruction process, which was executed by Digital Agencies, would ensure that the seized products do not find way back to the market anymore as the destruction and dumping process is authorized by NEMC and a certificate issued to show that the products are no longer legible for consumption.

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    Headlines Skinning Left, pagematch: 1, sectionmatch: 1 Headlines ( Leaderboard Top ), pagematch: 1, sectionmatch: 1 Pacquiao seeks to double tobacco tax rate By Gaea Katreena Cabico  (philstar.com) | Updated October 10, 2017 - 6:46pm The boxer-turned-senator was awarded the first anti-smoking champion belt by the Bawas Bisyo Youth for Sin Tax Movement  for filing the measure. Senate of the Philippines/Joseph Vidal MANILA, Philippines — Sen. Manny Pacquiao filed a bill seeking higher tax on tobacco “not only to collect more revenues but to protect the people’s health.”  “Human body is sacred. We should not destroy or desecrate it,” Pacquiao said in a statement.      The neophyte senator filed Senate Bill 1599, seeking to amend Republic Act 10351 or the Sin Tax Reform Law. The measure aims to increase the excise tax on tobacco products to P60 from P30 per pack. There will also be an annual increase of nine percent from the current four percent. For the boxing champion-turned-senator, the increase in cigarette excise tax will further “maximize its potentials in improving health, revenue and other development goals.” Headlines ( Article MRec ), pagematch: 1, sectionmatch: 1 Pacquiao noted his bill will reduce smoking prevalence to 19.8 percent by 2020 and will generate revenue to contribute to the government’s higher tax target. He said he had asked Sen. Sonny Angara, chair of Senate Committee on Ways and Means, to include Senate Bill 1599 in the Tax Reform for Acceleration and Inclusion. The Bawas Bisyo Youth for Sin Tax Movement on Tuesday awarded the first anti-smoking champion belt to Pacquiao for filing the measure.

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    The negative trend has accelerated in the last five years (-5.6 percent), as sales per capita have decreased in more than 90 sticks in that same period. Leading volume declines are from Ecuador, Brazil, and Colombia, while Uruguay, Argentina and Chile show greater resilience in cigarette consumption, although on the negative side as well. This grim picture concerning retail volume sales is defied and partly neutralized, at least until now, by the healthy profits and value growths reported by the main global players. This is due to their ability to push premiumization through innovation and is why we see product launches in Latin America concentrated in flavor capsule developments which have a much higher added value for companies. In virtually every market across the region this technology, which adds options to mix different flavors and intensities into the smoking experience, has been rolled out by global brands such as Luck Strike (Click&Roll or Indigo), or Marlboro (Double Fusion or Red Capsule). Nevertheless, this strategy may soon dry out as the Latin American consumer´s purchasing power, as measured in USD of disposable income per capita, has decreased by 9 percent in the last three years, suffering strong impacts from a series of global and local macroeconomic problems. This is reducing the industry´s option to continue profit gain from premiumization in cigarettes, and will eventually force competition for value into low and medium price ranges, as consumers tend to trade down. Good examples of this are the recent launches of brands such as Rothmans by British American Tobacco in Argentina or Winston by Japan Tobacco in Brazil. As well, illegal cigarettes are starting to play an important role as access to cheap smuggle and counterfeit products allow the base of pyramid consumers to keep up the frequency of smoking, in spite of inflation or rising prices. In fact, strongly rising prices well over the national inflation rates, are due to the huge increases in specific tax burdens for tobacco products in various countries such as Chile, Argentina, Peru, and Colombia. This constitutes another overarching regional development indirectly fueling illegal cigarettes.

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