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Tobacco Smuggling.

Dáil Éireann Debate, Thursday - 11 March 2010

Thursday, 11 March 2010

Questions (97, 98, 99)

Phil Hogan

Question:

96 Deputy Phil Hogan asked the Minister for Finance if he will make a statement confirming reports in a newspaper (details supplied) on 22 February 2010 that the customs service is seriously concerned about a rise in detections of illegal and counterfeit cigarettes in mainstream shops; if there have been a significant rise in detections of illegal and counterfeit cigarettes in mainstream stores since the introduction of the point of sale display ban. [12051/10]

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Phil Hogan

Question:

97 Deputy Phil Hogan asked the Minister for Finance the number of detections of illegal and counterfeit cigarettes in mainstream shops for 2007, 2008, 2009 and to date in 2010 in tabular form; and if he will make a statement on the matter. [12052/10]

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Phil Hogan

Question:

98 Deputy Phil Hogan asked the Minister for Finance if he will make a statement regarding the figures on smuggled cigarettes as quoted in a newspaper (details supplied) on 22 February 2010 which claim that 25% of cigarettes are imported illegally into this country compared to 3% in France and 2% in Spain; if he will release statistics that compare the levels of cigarette smuggling into this country to the rest of Europe; if the figures quoted in this newspaper have been made available to him by customs officials in the Revenue Commissioners; and if he will publish the report which highlights these figures in view of the fact that they have now entered the public domain. [12053/10]

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Written answers (Question to Minister for Finance)

I propose to take Questions Nos. 96 to 98, inclusive, together.

As I have outlined in response to numerous questions on this issue, I am informed by the Revenue Commissioners, who are responsible for the collection of tobacco products tax and tackling the illicit trade in cigarettes and tobacco products, that they are concerned at the current level of cigarette smuggling and the illicit trade in cigarettes. It is acknowledged that tobacco taxes in Ireland are currently the highest in the EU and unfortunately this means that despite the comparative small size of the Irish market, significant profits can be made by fraudsters who engage in this type of illicit activity.

While precise information regarding the number of detections made in mainstream shops is not available, I can advise the Deputy that a total of 284 seizures, amounting to 9.7m cigarettes, were made in 2009 at various inland locations, including retail outlets, markets and other distribution centres. There has been no noticeable trend in the rise of detections of illegal cigarettes in mainstream shops, which can be directly attributed to the introduction of the point of sale display ban on 1st July 2009. It should be noted that both prior to and after the introduction of the point of sale display ban, checks on suspect premises involved a thorough search of the premises concerned, including cigarette-dispensing cabinets.

Revenue's overall results of enforcement activities and operations in 2009 show that 218.5m cigarettes were seized and 165 convictions were obtained for smuggling and selling untaxed cigarettes, a significant increase on previous years. Of the 165 convictions recorded during 2009, 146 related to cigarette smuggling and 19 related to the sale of untaxed cigarettes. Revenue Enforcement Officers carry out checks, both random and intelligence driven, at retail outlets, markets and other distribution centres, in an ongoing operation codenamed Operation Downstream since December 2007 which targets contraband cigarettes that evaded detection at the point of importation.

The number of detections of illegal cigarettes (both contraband and counterfeit) made at inland locations under Operation Downstream is outlined in the following table:

Year

Number of seizures

Number of cigarettes seized

2007 (December only)

12

1.0m

2008

128

6.4m

2009

284

9.7m

2010 (to date)

47

1.2m

As I have stated previously, a report commissioned by a major cigarette manufacturer has been compiled annually over the past three years and contains estimates of the illicit trade in each Member State based on various research carried out. Officials from my Department receive a copy of this report simultaneously as do the Revenue Commissioners. This report is provided strictly on a confidential basis to the individual tax authorities of each Member State in respect of themselves only. Despite the appearance of varying media articles as to the level of the illegal trade across Europe, it would not be appropriate for my Department or I to put the general findings of the confidential report into the public domain.

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