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Press Release

Stop the rot inflicted by R19bn tobacco tax looters

Tuesday 3 May, 2022 – ONLY criminal prosecutions can stop tobacco tax cheats robbing millions of South Africans of the chance to escape poverty and disaster, Tax Justice SA warns today.

“The illicit cigarette trade is now robbing the nation and its people of R19 billion a year,” says TJSA founder Yusuf Abramjee. “That urgently needed money is filling the pockets of crooks

while honest, hard-working South Africans are left reeling from the ruinous effects of the pandemic, civil unrest and flooding.

“Organised crime kingpins massively enriched by the lockdown ban on legal tobacco have been living in luxury and siphoning much of their ill-gotten fortunes offshore.

“Although SARS has finally started to make moves against these industrial-scale looters, we now need to see arrests and the masterminds in court before they dodge justice for ever.”

Market researchers Ipsos have found that shops nationwide are flooded with illicit tobacco, with tax-evading cigarettes openly on sale in up to three-quarters of stores in hotspot provinces.

As TJSA’s own investigations have also shown, brands belonging to certain licensed manufacturers continue to lead this illegal price war.

Earlier this month, SARS announced it had launched an offensive against tax cheats in the tobacco industry, which included search-and-seizure operations at the homes of suspects.

Commissioner Ed Kieswetter said the crackdown was paving the way for criminal prosecutions and “no stone would be left unturned”.

“The time for talking is over,” says Abramjee. “The R19 billion stolen by these criminal manufacturers could pay the full repair bill for the KwaZulu-Natal floods, plus relief grants for half a million victims for a year.

“That money belongs to the South African people and should be collected by the State on their behalf.

“Commissioner Kieswetter’s transparency has gone some way to restoring public confidence in State authorities. We can only hope that the National Prosecuting Authority (NPA) is quick to show similar determination to mete out justice on the crooks who are condemning citizens to poverty and destruction.

“South Africa needs to stop the rot. We need to lock them up.”