RAS Blog

Category: Cigarette Smuggling

  • Retailers Against Smuggling welcomes cigarette seizure at Rosslare Europort

    Retailers Against Smuggling welcomes cigarette seizure at Rosslare Europort

    Retailers Against Smuggling (RAS) has welcomed Tuesday’s seizure by Revenue of 3,300,000 million cigarettes at Rosslare Europort with an estimated retail value of €2,400,000 representing a potential loss to the exchequer of €1,900,000. This brings the total quantity of seized illicit cigarettes reported by Revenue to over 40,000,000 so far this year pointing to a rapidly growing black market in Ireland.

    Considering this latest major seizure, retailers are reiterating their call to Minister for Finance Paschal Donohoe TD not to include a further excise increase on tobacco products in next week’s Budget 2022 announcement. Additional excise increases will only serve to further incentivise consumers to purchase from the black market fuelling further growth in smuggling activity, which continues to impact registered and legitimate tobacco retailers whose legal cigarette trade can account for 20 – 30 per cent of their business.

    RAS commends the ongoing work by Revenue officials in the fight against smuggling, particularly at our major points of entry through ports and airports.

  • 13.5 tonnes of raw tobacco seized points to large-scale illegal cigarette manufacturing

    13.5 tonnes of raw tobacco seized points to large-scale illegal cigarette manufacturing

    Retailers Against Smuggling (RAS) has warned that 13.5 tonnes of loose raw tobacco seized by Revenue so far this year indicates the likelihood of large-scale illegal cigarette factories operating on the island of Ireland. To date Revenue has announced four major seizures of loose raw tobacco with a combined estimated retail value of €8.1 million representing a potential loss to the Exchequer of €6.7m.

    Commenting, RAS national spokesperson, Benny Gilsenan said: “The significant volume of the consignments being seized, and the elaborate means being used to conceal this raw tobacco suggests that it’s unlikely the product is intended for direct resale to the consumer on the black market. The recent spike in these types of seizures has risen suspicion among legitimate retailers that the intended destination is likely to be illegal cigarette making factories operated by criminal gangs in either the Republic of Ireland or Northern Ireland.

    “In 2018, Gardaí and Revenue officials uncovered the first illegal commercial-scale cigarette production plant found in the State in Jenkinstown Co. Louth, which was capable of producing up to 250,000 cigarettes per hour. During that raid up to 66 tonnes of raw tobacco were seized which gives us sense of the volume of tobacco product required to run such an operation. The fear among retailers is that the volumes of raw tobacco now being seized at Irish ports are at a level which indicates that similar underground facilities are operational on the island of Ireland. For example, we know that roughly 13-15 million cigarettes could be produced from the 13.5 tonnes of raw tobacco seized alone, and we suspect further large volumes are getting into the country undetected.”

    Mr Gilsenan added: “Since the Jenkinstown raid several other illegal factories have been uncovered, primarily around the border regions, which suggests a link to illegal cross-border trade and criminal activity. The most recent seizure of an illegal factory on the island was in Armagh in July this year, which could produce 390 million cigarettes a year. While we fully commend and support the work of Revenue and An Garda Siochána as well as their counterparts in Northern Ireland in detecting smuggled tobacco and cigarettes, we believe more can be done by policymakers to tackle the growing illegal trade in tobacco products in Ireland.”

    In its recent Pre-Budget 2022 submission to Minister for Finance, Paschal Donohoe TD, RAS highlighted how continuous excise increases on tobacco are fuelling demand for a growing black market. This is resulting in increased levels of smuggling activity, impacting registered and legitimate retailers who face unfair ‘competition’.

    “The operation of illegal cigarette factories is just one challenge facing the retail sector. We are also very concerned by the additional spate of illicit cigarette and roll your own (RYO) tobacco seizures by Revenue so far this year. To date over 35 million cigarettes and over 20 tonnes of RYO tobacco have been seized highlighting just how active the black market currently is. The combined estimated retail value of all seizures this year amounts to over €45 million, close to €8 million more than the total for 2020.

    “We are calling on Government to consider the impact this increased rate of smuggling is having on retailers. The continued growth of the black market can only be halted by stopping the continuous excise increases on cigarette and tobacco products, the retail price of which is 121 per cent above the EU average according to a new Eurostat survey issued today”, Mr Gilsenan concluded.

  • No let-up in tobacco smuggling through Ireland’s ports despite additional Brexit checks

    No let-up in tobacco smuggling through Ireland’s ports despite additional Brexit checks

    Significant tobacco seizures at Ireland’s ports in 2021 provide a clear indication that illicit trade is stronger than ever despite the deterrent of additional Brexit related Revenue checks. That is the reaction from Retailers Against Smuggling (RAS) after Revenue seized four tonnes of tobacco worth over €2.4 million at Dublin Port this week.

    This is the fourth major tobacco and cigarette seizure by Revenue at Ireland’s ports this year.

    In February, two separate seizures in one day at Rosslare Europort yielded 5.7 million cigarettes while in January, two tonnes of tobacco were seized at Dublin Port. The potential loss to the exchequer of these four major seizures alone equates to €6 million, demonstrating that Irish ports remain a hotbed for smuggling.

    Commenting, national spokesperson for RAS, Benny Gilsenan said: “The issue of tobacco smuggling remains a huge threat for registered and legitimate tobacco retailers like myself across Ireland, whose legal cigarette trade can account for 20 – 30 per cent of their business. These major seizures when examined alongside the additional detections made at our airports and through warranted searches, demonstrate that the black market continues to be exceptionally active in 2021. The scale and means used to smuggle the tobacco seized at Dublin Port this week might also suggest that it was intended for further illicit cigarette manufacturing.

    “While we commend and fully support the hard work undertaken by Revenue and An Garda Síochána in the fight against illicit trade, our fear is that these seizures are only the tip of the iceberg. If this is the extent of the goods being seized, it is frightening to think about the volume of tobacco making it into the country unchecked costing the exchequer millions of euro in lost revenue and putting the livelihoods of retailers at stake.”

    In its headline results for 2020, Revenue reported a total of 4,390 seizures of cigarettes and other tobacco with a value of €32.7m, this compares to a value of €10.52m for 2019 representing a threefold increase.

    Mr Gilsenan added: “It is very plausible that Covid-19 international travel restrictions over the past twelve months has led to a growth in demand for the black market, which these criminals are trying to exploit by any means. For example, my own store alone experienced an initial 40 per cent rise in tobacco sales when travel restrictions were introduced but this has dropped right back to normal levels. So it begs the question, where are these sales going given that travel restrictions remain in place?

    “If we are to seriously tackle the issue of illicit trade there needs to be much stricter sanctions and more prosecutions for those who are caught smuggling. It is clear from the level of seizures recorded in 2020 and so far this year that the current deterrents to smuggling are not strong enough.”

  • Budget 2021 excise hikes will fuel further smuggling and penalises legitimate retailers

    Budget 2021 excise hikes will fuel further smuggling and penalises legitimate retailers

    Retailers Against Smuggling has expressed grave concern that yet another excise increase will lead to further increased rates of tobacco smuggling directly impacting legitimate registered retailers. The group was reacting to Budget 2021 announced by the Minister for Finance, Paschal Donohoe TD which included an increase of 50c on tobacco, bringing the cost of an average packet of 20 cigarettes to €14.00.

    Commenting National Spokesperson for Retailers Against Smuggling, Benny Gilsenan said: “It is very disappointing to see honest retailers take yet another blow with today’s excise increase which will inevitably make it even harder to compete with a growing black market. We have some of the highest rates of duty on tobacco products in the EU and it is no wonder that Ireland continues to be a target for tobacco smugglers, even while there is Covid-19 restrictions on travel in place.”

    In Revenue’s 2019 Annual Report, its Illegal Tobacco Products Research Surveys revealed that 15 per cent of cigarette packs held by smokers surveyed were classified as illegal. Also, in the Department of Finance’s own Tax Strategy Group paper it was noted that Revenue Commissioners have previously indicated that further increases in excise duties may not lead to increased revenue yields.

    Mr Gilsenan added: “We fully expect that the percentage of smuggled tobacco on the Irish market will continue to rise because of the increase, voiding any potential gains to the exchequer. As consumers turn towards the black market, ultimately it is the retailer who suffers through the loss of not only the legal purchase of cigarettes but also any potential additional purchases that person might make when they are in the store.

    “With Covid-19 restrictions set to be a reality of life for months to come and the looming uncertainty of Brexit, the detection and seizure of illegal tobacco products must remain a priority for Irish authorities, with increased awareness of the elaborate means criminal gangs are utilising to transport these huge volumes. Revenue and An Garda Siochana must be given the correct resources to ensure that criminals don’t continue to reap the benefits of the high cost of tobacco products.”

  • Seizures worth over €7.9m indicate cigarette smugglers are thriving despite coronavirus

    Seizures worth over €7.9m indicate cigarette smugglers are thriving despite coronavirus

    Rigorous monitoring and increased checks by Revenue are essential to combat a potential increase in illicit trade of cigarettes over the coming months. That is the call from Retailers Against Smuggling (RAS) who have raised concern over the potential growth of the black market as a result of Covid-19 and the upcoming ban on menthol cigarettes in Ireland, which comes into effect on Wednesday, 20th May 2020.

    Commenting, national spokesperson for RAS and Dublin based retailer, Benny Gilsenen said: “Significant seizures of cigarettes by Revenue in recent weeks, including two hauls at Dublin Port worth over €7.9m, indicates that the black economy is alive and well. As retailers across the country are struggling to adapt to the new operational realities and costs of Covid-19, these seizures tell us that it is very much business as usual for the criminals.

    “While we commend the efforts of Revenue in ensuring that these cigarettes do not reach the black market, including another seizure in Donegal over the weekend worth €40,000, there is no room for complacency in clamping down on cross-border smuggling, particularly in light of the new regulations coming into effect this month. Retailers like myself are very concerned that the ban on menthol cigarettes, which account for approximately 18 per cent of tobacco sales in Ireland, will result in a widening of a black market that is already having an adverse effect on local retailers. We have already witnessed a growth in the trade of illicit menthol cigarettes in the UK over recent months and there is a real risk we will see a similar trend emerge here.”

    The ban is being introduced to follow the completion of a four-year phasing-in period under a 2016 EU directive on tobacco products. According to its 2019 Annual Report, Revenue seized 3,215 cigarettes and 1,445 other tobacco products, at a total value of €10.52 million. This represented a 75 per cent drop since the same period in 2018.

    Mr Gilsenen added: “Looking at the significant drop in seizures between 2018 and 2019, it is glaringly obvious that criminal gangs are using whatever means necessary to evade detection and keep their illegal finances thriving. The spate of seizures in the last week should serve as a wake-up call for everybody.”

  • Massive spike in illicit roll your own tobacco damaging legitimate retailers

    Retailers Against Smuggling (RAS) have expressed their outrage at the figures shown in Revenue’s Annual Report and Tobacco Products Survey 2018, released this morning (Wednesday)The figures reveal that there has been a dramatic rise in the levels of illicit and non-Irish duty paid roll your own tobacco products in the last year, along with no decrease in levels of illicit/non-Irish duty paid cigarettes.

    RAS continues to commend Revenue on the work they are doing – this year 5,339 seizures of illicit tobacco products worth €42.3 million took place. However, it is clear that there are not enough resources available to Revenue and An Garda Siochána to tackle the severity of the situation. Of the 5,339, only 16 charges were made for smuggling and 58 for selling illicit products.

    RAS spokesperson Benny Gilsenan said “Revenue work hard, but it’s becoming clear that criminals are working harder to get these products into our country. Every year RAS express our concern over the growing levels of illicit products, and every year it seems to fall on deaf ears. 67 million illicit cigarettes were seized last year, but 453 million went on to be sold illegally. The numbers are staggering.”

    Most staggering are the levels of illicit and non-Irish duty paid roll your own tobacco products on the Irish market. The number of illicit packs has jumped from 15% in 2017, to 21% in 2018. The number of non-Irish duty paid also rose from 4% to 7%. Last year RAS repeatedly voiced major concerns about the impact of the introduction of a 30g minimum roll your own pouch size in May 2017. RAS also raised concerns over raising excise duty on these pouches.

    Mr Gilsenan concluded: “RAS is calling for immediate action and proper enforcement of the current legislation to ensure those who sell illicit products are met with the full force of the law. Retailers nationwide have paid all the relevant duties and taxes and are missing out on revenue and footfall as a result. Illicit tobacco funds criminal groups and only serves to damage legitimate and responsible retailers. We are asking Minister Donohoe not to raise excise on tobacco products, in Budget 2020 until this situation is under control.”

    Revenue’s full report can be found here

  • Illegal cigarette factory found in Louth highlights growing market for criminal gangs, say concerned retailers.

    15 March 2018

    11 people have been arrested after an illegal cigarette production factory was discovered by Gardaí and Revenue in Louth today. 25 million illegal cigarettes were discovered, along with over 40 tonnes of tobacco, as well as production and packaging equipment estimated to have cost the Exchequer €12 million.

    Retailers Against Smuggling’s (RAS) Leinster spokesperson Benny Gilsenan commented on the breaking reports today “The uncovering of the illegal cigarette factory run by criminals highlights the growing market in Ireland for cheap illicit tobacco products all the while successive Governments increase the price of legal cigarettes that legitimate and tax paying retailers like myself sell. It is also striking that this illegal factory producing branded packs at a time when retailers are receiving plain packs legitimate retailers

    It is time for the Government stop increasing excise and focus on the issue and give consideration to the impact the illicit trade is having on small retailers who are already struggling to maintain business and keep on current employees. RAS would like to thank an Garda Síochána and Revenue for all their hard work but unfortunately while our Government continues to ignore the grave concerns of the declining small retailer, there will only be more illegal cigarette and alcohol factories found across the State”.

  • One in Three Retailers Along the Border Concerned that Brexit will Create a Bigger Market for Smuggling Along the Border.

    28th September 2017, Dublin

    A cross-border survey conducted by Retailers Against Smuggling (RAS) has revealed that one in three retailers in Ireland are concerned about the rise in criminality and illicit trade following the decision of the UK to leave the European Union last year. Responses from 114 retailers in the counties of Donegal, Cavan, Monaghan, Sligo and Louth were recorded, along with 101 additional retailers across Northern Ireland. The survey results come weeks after Minister for Foreign Affairs Simon Coveney declared that Ireland’s interests would be at the forefront during Brexit talks. Smuggling and illicit trading increases must remain an important factor for the Irish government during border negotiations.

    The results showed that of those surveyed in the border counties, one third of retailers feel Brexit will create a bigger market for smuggling in the county, while 44% have noticed a significant increase in smuggled products and illicit trade in recent years, particularly since Brexit. This figure rises to 56% of their counterpart retailers north of the border.

    One-third of all retailers surveyed believe that Brexit will lead to a further presence of the black-market along the border and significant losses to the Exchequer, as well as their own businesses.

    RAS spokesperson and small business owner, Benny Gilsenan said “when a customer doesn’t buy their cigarettes in my shop, that means they’re not buying their pint of milk, they’re not buying their sliced pan. It has a huge knock on effect on small businesses”.

    Retailers on both sides of the border can no longer compete with the illicit trade of smuggled products. In terms of illicit trade, cigarettes and loose tobacco are by far the most urgent concern for retailers. Mr Gilsenan continued “smuggling is a constant concern for us as retailers. A packet of cigarettes bought on the street costs the consumer less than half price of what they would pay in a shop. A legitimate retailer selling a packet of cigarettes for €11.50 simply cannot compete with a smuggled pack that costs just €5. The Government needs to protect legitimate Irish retailers from the consequences of illicit trade”

    According to Revenue’s Illegal Tobacco Products Research Survey 2016, 10% of cigarette packs in Ireland are classified as illegal and a further 8% are Non-Irish Duty Paid. In a report released by Grant Thornton in 2015 found that a key driving force for the illicit trading of tobacco and alcohol is the continuously increasing level of excise duty on products. Half of all Irish retailers surveyed believe that the key to undermining cross-border smuggling of tobacco and alcohol is to harmonize tax and price differentials between Northern Ireland and the Republic of Ireland.

    The survey also revealed a shocking lack of trust in authorities both north and south of the border, with only 13% of those surveyed having confidence in the ability of authorities to tackle smuggling. There is a massive disparity between alcohol seizures and summary convictions in Ireland. In 2016 there were 1,875 seizures of illicit alcohol in the country, but only four summary convictions. Border retailers indicated in the survey that they would like to see the purchasing of illicit goods to be made an offence. This provision was one of the key measures proposed under the Sale of Illicit Goods Bill, which made it an offense for a person to buy alcohol, tobacco or solid fuel from an unregistered retailer.

    A roundtable discussion was held yesterday in Dublin to tackle Brexit, the Border & the Black Market. The event was co-chaired by Kevin Doyle, Group Political Editor at the Irish Independent, and Allison Morris, Security Correspondent from the Irish News. Members of An Garda Siochana, the PSNI, HMRC and political parties from both the Republic and the North met to discuss the issues that retailers on both sides of the border will face in the coming months and years. “The people that attended this roundtable discussion are the ones who can make a real impact. Events like this need to happen more often, it’s so important to keep the conversation going between officials in the Republic and the North. We need to work together on this.” Said Mr Gilsenan.

  • Retailers and the Exchequer suffer as over 742 million cigarettes bought illegally or brought from overseas

    27 April 2017

    The Revenue 2016 Annual report shows more resources are needed to tackle tobacco and alcohol smuggling:

    • In 2016, 10% of the cigarettes in Ireland were illegal, while 8% were non-Irish duty paid (NIDP)
    • This means that 742 million cigarettes in 2016 were not purchased from registered and legitimate retailers in Ireland.
    • Additionally, 9% of Roll Your Own (RYO) tobacco was illegal, with 3% NIDP.

    Retailers Against Smuggling (RAS) welcome the publication of Revenue’s Annual Report 2016 and Ipsos MRBI Illegal Tobacco Products Retailers Against Smuggling Research Surveys 2016, in particular the inclusion of Roll Your Own (RYO) tobacco figures ahead of the introduction of a 30g minimum pack size on 20 May this year. RAS now call for the Government to provide more resources to combat smuggling, particularly due to the uncertainty caused by Brexit.

    Small and medium-sized retailers’ trade is being undercut by smugglers, and the Revenue report reiterates the depth of the involvement of criminal gangs in smuggling of illicit tobacco in particular. RAS have repeatedly voiced their concerns about the impact of the introduction of a 30g minimum RYO pouch size on 20 May. This will mean the vast majority of RYO consumers face large ‘out of pocket’ spending increases, some as high as 300%.

    RAS spokesperson, Benny Gilsenan, commented: “Revenue’s statistics show once again that Ireland still has a huge problem with the illicit trade, which harms small retailers and strengthens criminal gangs. Only yesterday, RTE ‘Liveline’ broadcast a piece on adolescents advertising cheap, illegal cigarettes in Meath. These activities put retailers out of pocket and are happening because of a lack of awareness of the impact smuggling has on retailers, as well as a paucity of investment in combatting it,” Mr Gilsenan remarked.

    Alcohol

    The figures also highlight the shocking disparity between alcohol seizures and summary convictions: there were 1,875 seizures of illicit alcohol in 2016, but only four summary convictions. RAS call for proper enforcement of the current legislation to ensure those who sell illegal alcohol are met with the full force of the law. Retailers nationwide have paid all the relevant duties and taxes, and are missing out on revenue and footfall as a result.

    “At a time when retailers are facing an increasingly uncertain future with the looming spectre of Brexit, the Government have a responsibility to protect retailers and Ireland’s communities from this prevalent criminal activity.” Gilsenan continued.

    “RAS support Fianna Fáil TD Declan Breathnach’s Sale of Illicit Goods Bill, tabled in March. But it is clear to retailers that the Government needs to step up and protect small retailers before Ireland’s recovery is further threatened.”

  • OLAF calls for targeted national awareness-raising campaigns to fight cigarette smuggling

    21 July 2016

    Retailers Against Smuggling (RAS), representing over 3,000 retailers across Ireland, welcome the Eurobarometer survey OLAF (European Anti-Fraud Office) commissioned to explore the attitudes and opinions of Europeans on the cigarette black market in order to help Member States better target awareness-raising campaigns to fight cigarette smuggling. RAS have previously called for this in their pre-Budget submission and hope the government will use these interesting results to raise awareness of the impact the black market has on our economy and on legitimate tax paying businesses. The survey, entitled “Public perception of illicit tobacco trade”, pooled the answers of 27,672 respondents from different social and demographic groups in 28 Member States.

    Retailer and RAS Spokesperson Benny Gilsenan reacted to the survey results today: “of the 1,000 interviewees from Ireland, 81% of them would purchase illegal cigarettes because they are cheaper (compared to 74% in other EU countries). Illicit tobacco products can be bought from criminals for €4-5 which undercuts the legitimate retailer by 50%, yet our Governments is looking to further increase excise tax. Each time we increase excise tax, we allow for an increase in the illicit trade of cigarettes when what we really need is the enforcement of current legislation and more resources for Revenue”. RAS pre-Budget 2017 submission calls for a moratorium on further excise increases until such increases can be proven not to encourage smuggling as a result of price differentials. The Healthy Ireland Survey (October 2015) found that smoking levels are higher amongst those living in the most deprived areas and in lower social classes. Therefore increases in excise tax on cigarettes directly affects the poor and marginalised in society and in turn leads to the diversion of smokers to the illegal cigarette market.

    The survey also found that Irish respondents are twice as likely to see black market cigarettes as the second most important source of revenue for organised crime than other EU Member States (30% in IE, 14% in other EU MS). “It is clear that the Irish respondents see the black market as a major source of profit for criminals in Ireland. In order to tackle this hugely profitable illegal trade and to protect legitimate businesses the government needs to make it illegal to purchase tobacco or fuel products on which the carbon tax or tobacco excise has not been paid and allow for the repeal of market licences by Local Authorities where illegal goods are being sold”. 39% of Irish respondents also worry about the revenue for organised crime, compared to 35% of other EU Member States respondents.

    Benny concluded “it is clear that Irish citizens are worried about the impact of the illicit trade of cigarettes and we hope that the Government will take into consideration the measures in our Budget submission in order to protect the future of legitimate businesses”.