21 July 2016
Retailers Against Smuggling (RAS), representing over 3,000 retailers across Ireland, welcome the Eurobarometer survey OLAF (European Anti-Fraud Office) commissioned to explore the attitudes and opinions of Europeans on the cigarette black market in order to help Member States better target awareness-raising campaigns to fight cigarette smuggling. RAS have previously called for this in their pre-Budget submission and hope the government will use these interesting results to raise awareness of the impact the black market has on our economy and on legitimate tax paying businesses. The survey, entitled “Public perception of illicit tobacco trade”, pooled the answers of 27,672 respondents from different social and demographic groups in 28 Member States.
Retailer and RAS Spokesperson Benny Gilsenan reacted to the survey results today: “of the 1,000 interviewees from Ireland, 81% of them would purchase illegal cigarettes because they are cheaper (compared to 74% in other EU countries). Illicit tobacco products can be bought from criminals for €4-5 which undercuts the legitimate retailer by 50%, yet our Governments is looking to further increase excise tax. Each time we increase excise tax, we allow for an increase in the illicit trade of cigarettes when what we really need is the enforcement of current legislation and more resources for Revenue”. RAS pre-Budget 2017 submission calls for a moratorium on further excise increases until such increases can be proven not to encourage smuggling as a result of price differentials. The Healthy Ireland Survey (October 2015) found that smoking levels are higher amongst those living in the most deprived areas and in lower social classes. Therefore increases in excise tax on cigarettes directly affects the poor and marginalised in society and in turn leads to the diversion of smokers to the illegal cigarette market.
The survey also found that Irish respondents are twice as likely to see black market cigarettes as the second most important source of revenue for organised crime than other EU Member States (30% in IE, 14% in other EU MS). “It is clear that the Irish respondents see the black market as a major source of profit for criminals in Ireland. In order to tackle this hugely profitable illegal trade and to protect legitimate businesses the government needs to make it illegal to purchase tobacco or fuel products on which the carbon tax or tobacco excise has not been paid and allow for the repeal of market licences by Local Authorities where illegal goods are being sold”. 39% of Irish respondents also worry about the revenue for organised crime, compared to 35% of other EU Member States respondents.
Benny concluded “it is clear that Irish citizens are worried about the impact of the illicit trade of cigarettes and we hope that the Government will take into consideration the measures in our Budget submission in order to protect the future of legitimate businesses”.