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South Africa: Finance Committee briefed on illicit tobacco trade

May 4, 2018

Members of the committee are acutely aware of the health hazards of smoking but since smoking is not legally proscribed, the committee feels very strongly that the (SARS) should raise the full revenue it is entitled to from the tobacco industry 

CAPE TOWN, South Africa, May 4, 2018,-/African Media Agency (AMA)/- The Standing Committee on Finance has received a briefing on the huge loss of revenue to the fiscus through the Illicit Tobacco Trade (ITT).
Participants included the Tobacco Institute of South Africa, the Fair Trade Independent Tobacco Institute, the National Treasury (NT), SARS (South African Revenue Service), Financial Intelligence Centre (FIC), the Hawks and NPA (the National Prosecuting Authority).

Members of the committee are acutely aware of the health hazards of smoking but since smoking is not legally proscribed, the committee feels very strongly that the (SARS) should raise the full revenue it is entitled to from the tobacco industry, now, more than ever. The committee believes that every cent due to SARS has to be collected, especially in view of the revenue shortfalls in recent years and the need to fund major pro-poor programmes.

By their very nature, the loss of revenue through illegal activities like in the ITT, is difficult to quantify. But it’s estimated that a minimum of R5 billion is lost to the fiscus. This is completely unacceptable,” said Mr Yunus Carrim, Chairperson of the committee.

Mr Carrim said South Africa ranks around top 5 countries in the world with the highest incidence of trade in illicit cigarettes.

“The increase in the illicit tobacco trade makes cigarettes easily accessible even to children and defeats the health promotion regime of the country,” he said.

The committee believes that there should be far more effective coordination between SARS, the Hawks, the FIC, NPA and the National Treasury in more decisively tackle the ITT.

Finally, the committee also urged the Ministers under which these institutions fall, to work in a coordinated structure towards this goal.

Distributed by African Media Agency (AMA) on behalf of Republic of South Africa: The Parliament.

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