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  • 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.”

  • Ireland remains a target for tobacco smugglers as illegal cigarettes seized increases fivefold

    Revenue seized 31.2 million cigarettes during first six months of 2020 compared to 6.6 million in the same period last year

    Retailers Against Smuggling (RAS) have expressed unease over the high number of illegal cigarettes seized by Revenue during the first half of 2020 compared to the same period last year. An analysis of Revenue’s seizures by RAS revealed that there was an almost fivefold increase in cigarettes seized, from 6,659,500 (H1 2019) to 31,202,600 (H1 2020), indicating that Ireland continues to be a target for tobacco smugglers in spite of restrictions on travel.   

    Commenting, national spokesperson for RAS and Dublin based retailer, Benny Gilsenan said: “We commend and fully support the hard work undertaken by Revenue and An Garda Síochána in the fight against illicit trade. However, the smuggling of tobacco remains a significant concern to registered and legitimate tobacco retailers across Ireland, whose legal cigarette trade can account for 20 – 30 per cent of their business. The fact that over 31 million illegal cigarettes have been confiscated by Revenue during the first half of this year alone demonstrates that criminals continue to target Ireland and are adapting their methods in response to restrictions on personal travel by focusing their efforts on large consignments of smuggled products. It is just another indicator as to why it is becoming increasingly hard for legitimate retailers to compete with the black market.

    “It demonstrates that while current travel restrictions due to COVID-19 have resulted in low levels of Non-Irish Duty Paid (NIDP) entering the market, it is clear that criminal enterprises are continuing to seek out ways of ensuring smuggled products enter the country. We believe that there is still more that can be done and that is why in our recent pe-budget submission to the Minister for Finance, RAS called for the detection and seizure of illegal tobacco products to remain a priority for Irish authorities, with increased awareness of the elaborate means criminal gangs are utilising to transport these huge volumes.”

    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. This represents a potential loss to the Exchequer of €242 million in 2019 on 24 million illegal cigarette packs.[1] The same Revenue survey found that 12 per cent of the Roll Your Own tobacco packs held by smokers surveyed were illegal in 2019.

    Mr Gilsenan added: “The increase in the number of cigarettes seized in 2020 compared to the same period in 2019, and indeed compared to 2019 in total, indicates that an even greater number of cigarettes could potentially be making its way to the black market. This increase in the scale of the seizures highlights the importance of the work by Revenue and An Garda Síochána and the need for a continued focus on tackling illicit trade by the authorities. This criminality is directly affecting livelihoods and local retail businesses across the country who are already facing enormous pressures as a result of COVID-19.”

    [1] https://www.revenue.ie/en/corporate/documents/research/tobacco-surveys-2019.pdf

  • 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.”

  • More resources needed to tackle illegal smuggling in light of significant drop in tobacco products seizures

    More resources needed to tackle illegal smuggling in light of significant drop in tobacco products seizures

    Retailers Against Smuggling (RAS) is calling on the next Government to consider further resources in the detection and prosecution of illegal smuggling of excisable goods. New figures published by Revenue indicate that a new approach must be explored if we are going to stem the tide of illegal smuggling and give local legitimate retailers any chance against the flourishing black market.  

    The Revenue’s Annual Report for 2019 illustrated that:

    • Revenue seized 3,215 cigarettes and 1,445 other tobacco products, at a total value of €10.52 million, in 2019.
    • That is a 75% drop in the seizure of tobacco products since the same period in 2018 (the total value was €41.29 million).
    • This is also easily the lowest haul for Revenue since records began in 2013 – the lowest being in 2017 with a total value of €20.5 million.  

    RAS welcomes the Revenue’s acknowledgement that the problem is increasingly hard to detect, with criminal gangs now using inventive and complex smuggling and concealment methods. A more collaborative approach in tackling the issue is needed and RAS will work with Revenue in whatever way possible – for example greater sharing of information – and play its role in trying to combat the problem which is effecting livelihoods and local retail businesses across country.   

    Reacting to the publication of these figures, RAS spokesperson and retailer in Dublin Benny Gilsenan said “We know that the availability of tobacco products on the black market is widespread and yet we now hear that seizures are down significantly. It shows that criminal gangs are using whatever means necessary to evade detection and keep their illegal finances thriving. This needs to serve as a wake-up call for everybody”.    He added: “The incoming Government needs to take a fresh look at what can be done to tackle this vital issue. Illegal smuggling is not only bankrolling criminal gangs and draining resources from the State, it is crippling legitimate local retailers trying to make a living”.

  • Retailers Against Smuggling Highlight Devasting Impact of Illicit Solid Fuel with Gardaí and Local Politicians

    Retailers Against Smuggling Highlight Devasting Impact of Illicit Solid Fuel with Gardaí and Local Politicians

    Retailers Against Smuggling (RAS) along with CPL Fuels Ireland and Hardware Association Ireland (HAI) met with representatives from the local Garda Síochána and members of the Monaghan County Council to highlight their growing concerns with illicit trade of solid fuels.

    Attendees at the County Monaghan Joint Policing Committee heard about the dire impact on sellers, distributors and manufacturers due to the levels of illicit solid fuel trade in the border region, and the industry reiterated its concern over the Government’s inadequate response to tackling the issue.

    RAS Sub-Group member and CPL Fuels Managing Director Niall McGuinness spoke at the meeting saying “We urgently need greater visible action from the powers that be in tackling this issue that is ruining people’s livelihoods, or it will only get worse. Today was a good step forward and shone a light on the real impact illicit solid fuel trade is having, particularly in the border region”.

    HAI’s Jim Copeland said “Our members are under extreme pressure to keep up with the levels of fuel coming over the border. Some of them have stopped selling fuel all together. A carbon tax increase will put over 1,200 jobs at risk – something must be done.”

    Solid fuel can represent up to half of some retailers’ turnover, particularly in the Winter months. The illegal fuel trade is booming in Ireland and the Government must make it a priority to protect Irish retailers especially in the lead up to Brexit.

    The illicit solid fuel trade is costing the Exchequer over €9.7 million in lost revenue, which represents a loss of €36.5 million to retail merchants, putting many local traders out of business. Different tax approaches in the Republic of Ireland and in Northern Ireland make a lorry load of coal €2,217 more expensive in the Republic than in The North. A carbon tax hike in Budget 2020 will make this gap even larger and encourage smuggling of solid fuel over the border. RAS, CPL and HAI also raised the issue of fuel poverty at the meeting. 28% of people in Ireland experience energy poverty. Those who can afford to buy 1 tonne of untaxed coal online from Northern Ireland and have it delivered to their homes in the Republic for personal use do so, while the 28% of citizens experiencing fuel poverty have no opportunity to do the same. This practice is contributing to the cost gap between those Irish Citizens experiencing fuel poverty and those benefitting from the lack of enforcement on fuel coming across the border.

  • Latest Excise Hike leaves Retailers at a Loss

    Retailers are at a loss to understand the Government’s decision to impose another excise increase of 50c in today’s Budget. Retailers Against Smuggling’s (RAS) National Spokesperson Benny Gilsenan commented on the announcement: “In the backdrop of a potential no-deal Brexit, the return of a Duty Free regime between Ireland and the UK and an ever fluctuating Sterling, all of which will lead to further growth in the illicit trade, tax compliant small and medium sized retailers are once again penalised while criminals and Airport Duty Frees reap the benefits as the cost of tobacco products increase yet again.” 

  • RAS welcomes RCPI call for more anti-smuggling funding

    Retailers Against Smuggling have welcomed a call from the Royal College of Physicians of Ireland for extra funding to be made available for anti-smuggling measures in their Budget 2020 submission published this week. RAS spokesperson Benny Gilsenen said “We agree with the RCPI that additional funding should be made available for anti-smuggling measures. RAS have asked for extra funding for Revenue and the Gardaí year on year. This year is especially important with Brexit due to happen at the end of October and still no deal in place. Government also needs to recognise the significant increase in the illegal trade of Roll Your Own (RYO) tobacco, which has more than doubled in the last two years.”  RAS are calling on the government to increase spending on anti-illicit trade measures and to freeze any further excise hikes on tobacco products until the situation is under control.

    Note to the editor:

    • Ipsos MRBI’s Illegal Tobacco Products Research Survey 2018 that there was no decrease in the level of illicit cigarettes in Ireland with the figure for illegal packs remaining at 13%, and non-Irish duty paid (NIDP) at 9%. The survey found that approximately 453 million illegal cigarettes (23 million packs) were consumed in Ireland in 2018, representing a loss to the Exchequer of approximately €211 million.
    • A growing area of concern for retailers is the illicit trade in Roll Your Own tobacco (RYO) following the introduction of a 30g minimum RYO pack size on 20 May 2017. This new minimum means that the vast majority of RYO consumers face large ‘out of pocket’ spending increases, some as high as 300%, therefore pushing those users to purchase on the illicit market. The Illegal Tobacco Products Research Surveys 2018 found that the number of illicit RYO pouches held by smokers surveyed has more than doubled in the last two years – jumping to 21% from 9% in 2016

  • 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

  • ZERO seizures of illicit solid fuel in 2019 despite growth in black market

    5 April, Dublin

    Retailers, suppliers and manufacturers of solid fuel in Ireland are outraged today following a response to a parliamentary question from Minister for Finance Paschal Donohoe last week. Fianna Fáil Deputy Jim O’Callaghan asked the Minister about seizures of smuggled solid fuel to date in 2019 to which Minister Donohoe stated that there have been none.

     

    Managing Director of CPL Fuels Niall McGuinness said “the fact that there have been no seizures this year is completely unacceptable. Manufacturers, suppliers, retailers and the dogs in the street know that solid fuel is being illegally sold all over the country. The Minister’s response is extremely worrying for the entire supply chain, we need support from the Government especially as Brexit is fast approaching”

     

     

    Large quantities of cheap, non-SFTC (Solid Fuel Carbon Tax) paid solid fuel is being sold illegally and in plain sight as far away from the border as County Kerry. Solid fuel can represent up to half of some retailers’ turnover, particularly in the Winter months.  Due to the stark differences in tax policies on both sides of the border, 26 tonnes of coal (one truck load) is €2,217 more expensive in the Republic of Ireland than in Northern Ireland. Based on our calculations, carbon tax evasion alone at 20% results in an estimated loss of €9.6 million to the State. The amount lost to retailers at this rate is even more staggering at €36.5million a year.

     

    The Minister also stated that just €640,000 in lost revenue from SFTC has been recovered out of a potential €9.6 million year on year loss. Mr McGuinness concluded “this is simply not good enough. Not only are we losing out on sales, the Exchequer is losing out on receipts. Pair that with the fact that the fuel coming over the border is smoky coal and bad for the environment. It is the Irish public that are ultimately paying the price.”

     

    Currently there is no deterrent to purchasing smuggled goods as it is not a crime. Retailers Against Smuggling supports the Sale of Illicit Goods Bill which aims to deter people from buying illicit alcohol, solid fuel and tobacco by introducing on-the-spot fines for buying goods where taxes have not been paid. This bill is a necessary measure to protect small Irish retailers.

    – ENDS –