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Tobacco smuggling - at last a serious and proportional response

New measuresand money to tackle tobacco smuggling mark a step change and order of magnitudeincrease in the Government response to this insidious and damagingproblem.  Clive Bates, Director of ASHsaid: "at last we have a serious and proportional response to the cigarettesmugglers. They have really upped the stakes and tobacco smuggling will be amuch more risky business from now on."

Commenting onthe economic good sense of spending £209 million to recover £3 billion in taxrevenue, Bates added: "It's hard to imagine a better public sector investmentthan spending just over 200 million pounds to bring in an extra three billionin recovered duties, which is an amazing fifteen-fold return oninvestment.  This is inspired publicspending on revenue evasion which will leverage huge new resources for spendingon the things that matter."

But ASHwondered why the approach had not been taken to its logical conclusion: "if youcan spend 200 million pounds to raise three billion,  why not go further and spend more to bring in even more? I doubtthey have reached the point of diminishing returns in spending money on a crackdown on smugglers." said Bates.

And ASH wasconcerned that about the limited ambition of the proposals, which only aim tohold smuggled market share at 20% (approximately the current level) in 2003-4compared to a projected market share of 36% without the new package.

"The new moneyonly aims to contain the smuggling problem at about current levels and to chokeoff the growth - but what we really need is a plan to bring smuggling rightdown so that the organised criminals are driven out and smuggling once againbecomes a marginal activity." said Bates.

"Moneyshouldn't be a problem because almost any package of measures they couldpossibly devise would pay for itself many times over in recovered cigaretteduties."   added Bates

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