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SA tobacco market completely taken over by illicit suppliers - Batsa

It said that the ban had cost state over R4 billion in excise tax losses, with 30,000 jobs lost in the industry since the lockdown came into effect.

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

CAPE TOWN - British American Tobacco South Africa (Batsa) claims that the market has been completely taken over by illicit cigarette suppliers.

It said that the ban had cost state over R4 billion in excise tax losses, with 30,000 jobs lost in the industry since the lockdown came into effect.

"This means that tax-compliant manufacturers like ourselves continue to be at a disadvantage while the state is losing around R35 million every single day in excise taxes."

The company's Johnny Moloto said that replacing the ban on tobacco sales with increased excise was also not the way to go as it would compound the situation.

"With an already overstretched consumer, further increasing the cost of tobacco products will simply mean they default to the illicit market, which is now significantly cash-flush and can now afford to significantly reduce their prices."

He added that the illicit tobacco trade had become entrenched.

"These illicit supply chains will be so entrenched that it will be difficult for Sars to be able to reverse this or deal with this within a short period of time."

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