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Illicit Trade in Tobacco

Dáil Éireann Debate, Tuesday - 17 January 2012

Tuesday, 17 January 2012

Questions (136)

Derek Keating

Question:

151 Deputy Derek Keating asked the Minister for Finance his response and that of the Customs and Excise Service to the report that as much as 18% of cigarettes smoked here last year were illegally imported; his estimate of the loss of revenue to the Exchequer due to such activity; and if he will make a statement on the matter. [2457/12]

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Written answers

I am unaware of the specific report to which the Deputy refers. I am informed by the Revenue Commissioners that a survey commissioned by Revenue and the Office of Tobacco Control in 2009 estimated that 20% of cigarettes consumed in the State had not been taxed in this jurisdiction. This figure was further broken down as 14% illicit product and 6% legally imported by passengers arriving into the State from other jurisdictions. A similar survey in the last quarter of 2010 confirmed these estimates. Based on an estimate of 14%, the loss to the Exchequer from illicit cigarette consumption in 2011 would be in the region of €250m (excise duty + VAT). A further survey is currently under way.

Revenue is very conscious of the threat posed by the illicit trade in tobacco products and, in 2010, established a high level internal group, chaired at Commissioner level, to examine the risks involved and to oversee and optimise the detection of contraband and counterfeit tobacco products. This group has promoted a number of initiatives aimed at counteracting the illicit trade in tobacco. These include the adoption of a comprehensive tobacco strategy, which is underpinned by annual action plans.

The overall strategy being employed by Revenue to tackle this illicit trade is multi-faceted. It includes ongoing analysis of the nature and extent of the problem, developing and sharing intelligence on a national, EU and international basis, ongoing review of operational policies, development of analytics and detection technologies, and optimum deployment of resources at point of importation and inland, in order to intercept the contraband product and to prosecute those involved.

In 2011 Revenue seized 109 million cigarettes with a retail value of €46 million, and 11,158 Kgs of tobacco with a retail value of €4 million.

Also in 2011, Revenue obtained 101 convictions relating to cigarette smuggling, with fines of €136,300 and 30 custodial sentences imposed. Another 57 convictions relating to the sale of unstamped tobacco products, with fines of €115,850 and 13 custodial sentences imposed, were also obtained.

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