RAS Blog

Tag: Retailers against Smuggling

  • Retailers call for Government consultation on making it an offense to purchase illicit products

    20 February 2017

    Retailers across the country are today calling on the Government to urgently consult with them on measures to tackle sales of illegal cigarettes and tobacco on Ireland’s streets. The UK revenue and customs, HMRC, last week launched such a consultation, with the focus in particular on repeat offenders. RAS note that we do not know the numbers of those who have been caught several times or more selling illicit products in Ireland. Following an informal targeted consultation in 2015, this new consultation is seeking views on four potential additional sanctions:

    • increasing financial penalties for repeat offenders
    • a new civil penalty for dealing in illicit tobacco
    • reducing the threshold for the publication of details of people or companies that deliberately evade duty
    • a statutory duty of care on landlords and landowners of properties or land

    Retailers Against Smuggling (RAS) Leinster spokesperson Benny Gilsenan welcomed the consultation: “The proposals in this consultation are prime examples of what can be done with minimal effort to help tackle illegal tobacco sales and protect the legitimate, tax-paying retailers of Ireland. While some of the proposals mentioned are already in place in Ireland, Retailers are being undermined day in day out by sellers of illegal tobacco and we have real solutions to help tackle this problem. Our views must not be pushed to the sidelines, so today we are calling on the Government to look at what their European counterparts are doing and launch a similar consultation on making it an offense to purchase illicit products here in Ireland”.

    The consultation also seeks views on the introduction of a new civil penalty for fiscal mark wrongdoings. Benny concluded: “RAS have been calling on the Government for the past number of years to make it illegal to purchase alcohol, solid fuel or tobacco products where the duty has not been paid. HMRC are already looking at where they can place this legislation, it is time the Irish Government listen to the legitimate retailers – with Brexit around the corner we need to protect tax-paying businesses from the impact of the growing black market”.

  • Tax Strategy report encouraging Budget 2017 excise increase is direct win for smuggling criminals

    21 July 2016

    Retailers Against Smuggling (RAS) Spokesperson Benny Gilsenan expressed his frustration and disappointment following the publication of the Tax Strategy Group report (TSG) today which suggested it may be prudent to raise the Minimum Excise Duty in Budget 2017: “despite the TSG highlighting that 12% of cigarettes in Ireland are illicit and that we have a huge problem with tobacco product smuggling, the Government are being advised to continue to raise the price of cigarettes which will only impact legitimate retailers and the poorer in our society”. 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.

    Over the period 1994 to 2015, Tobacco Products Tax fell from contributing 4.3% of Exchequer tax revenue to 2.4% despite excise on tobacco products increasing in 20 of the last 24 budgets. Benny continued “It is clear to me that the Government will not take into consideration the direct impact this is having on legitimate tax paying retailers and those less off in our society and are playing into the hands of the criminal who sell packs on the street for €4-5 undercutting retailers by a whopping 50%”.

    The TSG noted that the amount of illicit cigarettes seized by Revenue has been on the increase since 2012 and that this “is a clear indication of the significant level of both small-scale and bulk smuggling activity”. Benny concluded “until such time as smuggling has been brought under control in Ireland (under 5% of all product sold), there should be no further increases on tobacco excise”.

    Retailers Against Smuggling (RAS) represents over 3,000 retailers, working to generate widespread awareness of tobacco and fuel smuggling in Ireland, its cost to retailers, how it is affecting their local economy and how legitimate retailers are disadvantaged because of smuggling by organised criminal gangs on both sides of the border.

  • 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”.

  • As the Black Market continues to grow, what will the new Government do differently to tackle the blight of smuggling?

    27 May 2016

    Despite the prevalence of smoking in Ireland decreasing from 22% in 2009 to 17% in 2014 (Department of Health), the illicit trade of tobacco continues to be a huge burden on the public purse with an annual loss of revenue to the Exchequer. In the first five months of 2016 Revenue seized smuggled cigarettes and tobacco products worth almost €12.3 million to the Exchequer, an increase of €2 million during the same period in 2015. Meanwhile, the solid fuel sector has expressed concern over the fact the Revenue have no reliable way to estimate the size of the smuggled solid fuel trade across the border.

    This €2 million increase came following the excise increase of 50c in October 2015. Benny Gilsenan, retailer and Retailers Against Smuggling (RAS) spokesperson for Leinster, commented “I struggle to see the logic of increasing excise tax not only because it drives people to the Black Market for their €3-4 pack of illegal cigarettes but it also leads to a tobacco tax yield budget shortfall which was calculated by the government in 2015 as being €223 million. In the run up to the budget, the Government really has to address the elephant in the room which is that excise increases are only contributing to the problem. ” On that basis alone, RAS calls for a moratorium on further excise increases until levels of smuggling are tackled.

    In its 2015 Annual Report, Revenue found that 12% of cigarettes packs held by smokers were classified as illegal. Benny continued “The fact that 1/10 cigarette packs are illegal highlights that more intervention is necessary by the new Government to cut off the blood supply of these multi-million euro businesses run by criminal gangs. Legitimate businesses like mine are being directly affected. We pay all of our taxes, the tobacco retail licence fee and adhere to the Show Me ID programme so the Government should be protecting our legal businesses.” Increased spot checks by Environmental Health Officers on non-retail outlets are necessary to prevent the sale of illicit tobacco products and solid fuel.

    “To make matters worse, of the 5,927 seizures in 2015 fines averaging €2,656 were imposed in just 89 cases. The current legislation for attaching fines only covers those already in employment. It is clear to me that this needs to be extended to those unemployment or on benefits in order to begin to deter people from selling smuggled goods on our streets” said Benny.

  • Retailers call for next Programme for Government to seriously commit to tackling the illegal trade of tobacco and fuel.

    15 March 2016

    In a letter sent today to all parties, Retailers against Smuggling (RAS) set down an Action Plan which it believes will go a considerable way in stamping out the unacceptable levels of competition legitimate retailers’ face from criminal gangs who sell illegal tobacco and fuel.

    “While the formation of the next Government is not yet clear, the issue of the illegal tobacco and fuel trade continues to be a significant issue for retailers nationwide. Small legitimate businesses rely on the legal cigarette trade for 10-30% of our business and these criminals selling cigarettes on our streets are directly impacting us. We believe the targeted approach in our action plan will be effective” said Benny Gilsenan, spokesperson of RAS.

    A key ask of the RAS Plan is the establishment of a Working Group on illegal trade in Ireland. This Group would invite all interested and affected parties to participate and would review the impact draft legislation would have on smuggling. These findings could then feed into policy debate in Dáil Éireann. “This Group would give retailers and others affected by the black market the opportunity to highlight the impact it has on their businesses and communities” commented Mr Gilsenan.

    In addition to the Working Group, Retailers Against Smuggling Action Plan also calls for:

    1. Making it illegal for a person to purchase illicit cigarettes
    2. Additional resources for An Garda Siochána and the Revenue Commissioners, for the work of the Joint Agency Task Force, set up under the terms of the 2015 A Fresh Start Agreement, to tackle cross-jurisdictional organised crime
    3. A moratorium on further excise increases until such increases can be proven not to encourage smuggling as a result of price differentials.
    4. An extension of the Fines (Payment and Recovery) Act 2014 to cover all those deemed to have illegally smuggled cigarettes or fuel, regardless of that person’s means.
    5. An extension of the investigations scope of Revenue to non-registered retail outlets; for those outlets which are repeat offenders of selling illicit cigarettes and tobacco, the serving of closure orders.
    6. A repeal of market licences by local Councils where illegal goods have been found to be sold
    7. Increased inspections of non-tobacco and non-fuel retail shops by the EHO

    Retailers Against Smuggling are fully behind the Joint Agency Task Force, set up under the terms of the 2015 A Fresh Start Agreement, to tackle cross-jurisdictional organised crime. “Smuggling along the Border has been a major route of black market goods that threaten the livelihood of small retailers right across the country. We have had enough and it is time to put a stop to this criminality once and for all” said Mr Gilsenan.