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Smuggling Increasing: Capitulation to organised crime orcontinue with good health policy?

The latest Mintel report [1] refers to a thriving black market insmuggled cigarettes, which they attribute to the Government's hightobacco tax policy. Karl Brookes of ASH said: "Customs are tackling the problem. High tobacco taxes cause people to smoke less or even toquit. Criminal activity can not be allowed to undermine this good health policy."

The drop in sales could also be due to smokers quitting, or cuttingdown on their smoking, for health reasons. The Mintel report alsoreveals that 62% of former smokers gave up for health reasons and that46% of smokers regret starting. Moreover, the Office for NationalStatistics shows that 70% of smokers want to quit.

The 'smuggling epidemic' stories are following a familiar pattern. InSweden and Canada [2], the problem of smuggling was continually 'hyped'up. Both Governments cut tobacco taxes. Once the tobacco industry hadreduced tobacco taxes, the amount of news coverage reduced but thesmuggling continued. The tobacco industry could help solve the problemof smuggling by not supplying their products to known suppliers oftobacco smugglers [3].

Brookes added: "If people knowingly buy smuggled cigarettes or use theInternet to buy tobacco without paying the UK duty, then they arebreaking the law. The risk of conviction is not worth the savings."

Notes
[1]. Mintel Product Report on the Cigarette Market, Executive Summary, 5.11.99

[2]. In Canada the reversal has hit tax revenues and stimulated extrasmoking ­ it has been a clear lose-lose outcome.

[3]. The International Herald Tribune reported the first successfulprosecutions of tobacco industry executives (from RJ Reynolds) forinvolvement in smuggling on December 24, 1998. Tobacco companies havesupplied wholesalers in Belgium and Andorra knowing that thecigarettes would re-enter the UK illegally. The Gallaher 1997 annualreport says:"Gallaher believes the gains [to Gallaher] in Andorra relate toincreased bootlegging trade into the UK."

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