Cigarette companies warn of flood of counterfeit cigarettes into UK
The amount of cigarettes purchased in the UK which have kept away from duty and taxes is considered to rise, one of the UK’s major three companies has warned.
Japan Tobacco International, the maker of Winston and Camel cigarettes, carried out a hidden shopping visit around north-west London that unveiled a huge range of counterfeit cigarettes and rolling tobacco being marketed for around half the retail price.
These consist of famous brands of cigarettes where the packaging is written in Spanish but the tax stamp is Belgian and rolling tobacco which consists of large amounts of impurities.
The company believes that after two of the biggest duty increases in the past two Budgets – a total of 70p on a packet of 20 – the rate and production of counterfeit cigarettes will rise.
The latest study demonstrated that 23.3% of cigarettes smoked in London and a shocking 44% of rolling tobacco had stayed away from UK taxes. That is nearly 50% higher than the national average of 16.4%. It is calculated that nationally the Treasury lost £2.9bn in 2011 from the trade of counterfeit cigarettes.
Signs that the level of the trade of counterfeit cigarettes is increasing} are going up. In the past 10 months Her Majesty’s Revenue & Customes has grabbed more than one million false rolling tobacco pouches being smuggled into the country to be filled with counterfeit tobacco. The latest court case which found the ringleaders of a 10-man gang keeping an illegal cigarette factory in Chesterfield jailed, heard it made a calculated revenue of ?120m a year and broken into the Treasury of more than ?130m in tax.
Martin Southgate, JTI’s UK managing director, s convinced that the measure to propose unbranded packaging is not a solution of the problem. He said: “These actions will not help obtain a decrease in young people taking up smoking, this will only boost the illegal tobacco trade.”
The Government was due to have posted its reply to a consultation paper from the Department of Health in November but seems to have postponed it once again.
Imperial Tobacco boss Allison Cooper has already endangered to take legal action if the Government presses ahead with ideas to make cigarettes to be marketed in plain packaging. She said that the measure could produce a provocation for illegal cigarettes.