BATSA says non-compliance with the law 'rampant' in cigarette trade

BATSA's General Manager Johnny Moloto has referred to the illicit cigarette trade as "tax evasion on an industrial scale". Moloto spoke with eNCA's Thulasizwe Simelane. Courtesy of #DStv403

JOHANNESBURG - The illicit cigarette market has been transformed into a multi-billion-rand free-for-all for lawbreakers.

This according to a strongly-worded statement by British American Tobacco SA.

The company is calling for an urgent inquiry following the release of a report by market research company Ipsos, which found that 41 percent of retail outlets nationwide sold cigarettes below the minimum collectable tax level.

WATCH: BATSA welcomes tobacco sector probe

The lowest purchase price for a pack of 20 was around R9.

"If you find a pack selling for R9, how could tax have been paid on that pack?" BATSA General Manager Johnny Moloto asked.

"There is no way that anybody would’ve been working as a philanthropic organisation giving product for free – that should raise alarm bells on its own to the authorities: to say something is amiss here.

READ: Cigarette ban caused slight brand shift: survey

"How can these individuals have paid tax even if it was to be discounted and accounting for stock theft that would have flowed into the market but at the scale, which we now call an industrial scale, where it’s found in every corner – that is quite concerning. 41 percent is quite high, in any sector," he said.

"If the motor sector for example were to be saying that 41 percent of vehicles in this country are stolen cars, that is something quite significant and alarming. And this is exactly what we are saying – this is quite alarming. You can’t have an industry that has gone so rampant in terms of non-compliance with the law."


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