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Press Release

1100% rise in illicit cigarette trade is a national emergency

Tuesday 26 March 2024 – DAMNING new evidence showing that South Africa’s illicit cigarette trade has sky-rocketed by more than 1,100% in little over a decade proves that the Government is failing in its duty to combat criminals who are looting our country of billions of rand, according to Tax Justice SA.

Researchers from the economics of excisable products unit at the University of Cape Town (REEP) stated today that criminals’ share of South Africa’s cigarette market shot from 5% in 2009 to over 60% in 2023.

As a result, more than R110 billion in tax revenue has been stolen from the nation over the same period, they added.

TJSA founder Yusuf Abramjee: “Kingpins in organised crime have been helping themselves to money that should have been spent on education, health care and housing.

“This industrial-scale looting was turbo-charged by the Government’s unconstitutional ban on tobacco sales during the pandemic. Our enforcement agencies have been unable or unwilling to curb it ever since.

“This failure by authorities is an act of economic sabotage that is condemning honest South Africans to hardship and suffering. We demand that Government tackle the illicit cigarette trade as a national priority with immediate effect.”

The REEP researchers said that as well as the “disastrous” fiscal losses, the “enormous” illicit cigarette trade was a threat to public health as it is fuelling cigarette consumption. “The relatively low price also encourages more young people to try smoking,” they said. “Reducing the availability of illicit cigarettes is therefore critical for public health.”

Abramjee said: “Illicit cigarette barons have been given a free rein for far too long. It’s become a national emergency and we must act now.

“The Government must finally ratify the WHO’s protocol on illicit trade. SARS must be allowed to install cameras in all tobacco factories. And police and prosecutors must be equipped to investigate the illicit trade, hunt down the kingpins and bring them to justice.”