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Tobacco firms complicit in illicit cigarette trade, claims expert

Research shows that 25% of the local illicit market seems to be coming from big companies.

Police confiscate illicit cigarettes valued at R122,000 destined for the black market on 12 May 2020. Image: SAPS

CAPE TOWN - Amid an outcry over how a ban on tobacco sales has benefitted illicit trade, an expert claims that reputable companies have for decades been complicit.

Telita Snyckers, the author of Dirty Tobacco - an expose on the dark underbelly of the tobacco industry - on Wednesday gave a virtual address to the Cape Town Press Club.

Illicit tobacco has been making headlines due to the ban on cigarette sales during South Africa's COVID-19 lockdown.

However, it's been prevalent for decades.

Telita Snyckers said that for years Zimbabwe held the biggest share of the insidious black market.

Now research shows 25% of the local illicit market seems to be coming from big companies.

Snyckers explained that some listed companies may be smuggling their own product.

"South African manufacturers are declaring tobacco for export to other countries in Africa, generally, and 66% of those declared as export consignments are never declared as having been imported in the destination country."

She said that this had important tax implications.

"When you export a consignment of cigarettes, South African taxes and duties aren't payable on those consignments. You can pretend to be exporting but in fact, keep them on the local market instead and you can sell those cigarettes tax-free and duty-free."

Snyckers believed that government had overstepped the bounds of rationality with the ban on tobacco sales, as the economic losses far outweighed perceived harms to health.

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