May 3, 2010 - The trade in illicit (illegal, contraband, smuggling) tobacco has reached new heights in the Republic of Ireland, creating more problems for the nation's recession-hit independent retailers.
Finance Minister Brian Lenihan said he did not increase excise on cigarettes in the December budget fearing the already high price - around 8.45 euro (12.88 USD) for a pack of 20 - could contribute further to the smuggling problem. (Ireland - no increase in excise duty on tobacco products worry about smuggling..)
One store owner from Temple Bar in Dublin told C-Store that his turnover had plummeted from £25,000 (38,117.26 USD) a week to £15,000 (22,870.29 USD) in the past 12 months as illicit traders adopted crafty new ways of selling cheap counterfeit cigarettes.
Handwritten notes offering counterfeit versions of top-selling brands for little more than half the legitimate price are being widely dropped through letter boxes. C-Store saw scribbled notes offering 200 JPS Blue cigarettes for just 45 Euros (59.40 USD) more than 40 Euros (52.79 USD) cheaper than the legitimate price.
There are also widespread reports of illicit traders targeting people who leave their contact numbers in the classified sections of local papers.
A Centra retailer from Cork said he was aware of cartons of 200 cigarettes being sold for 20 Euros (26.39 USD) through his local pub.
Maired Warren, manager of O Reilly's Garage in Cork, said the problem had worsened noticeably since a ban on the display of legitimate tobacco was enforced in shops last summer. "Before it was mainly cigarette sales that were being affected, but roll your own is now a problem, too," she said.
"While the legitimate channel is being forced to comply with a mountain of regulation, very little is being done to combat the illicit trade, making it an attractive option for criminals," she added. (Ireland - increase fine for cigarettes imported illegally..)
Anti-smoking group ASH Ireland also said that more needed to be done to control the problem. "Customs and Excise needs additional services to tackle this epidemic or it will expand rapidly," a spokesman warned. "Additional personnel, technology, canine support and legislative changes are needed urgently."
Reference: Illicit tobacco trade booms in Ireland Gaelle Walker, Convenience Store, the Grocer, 4/29/2010.
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