Cigarette smuggling hits taxman for €500m

By Juno McEnroe

Friday, March 20, 2009

CROSS-BORDER cigarette smuggling is being carried out by increasingly sophisticated criminal gangs and costing Irish taxpayers €500 million a year, it was warned yesterday.

The Director of Public Prosecutions (DPP) said one-in-every-four cigarettes smoked in Ireland was illegally imported tobacco.

James Hamilton stressed that because Ireland and Britain had the highest cigarette tax in Europe, it was now a "primary target" for smugglers.

"Organised crime and in particular cross-border fraud is a huge challenge facing all of us. Evidence shows us that organised criminals are increasingly sophisticated, operating across borders and continents," he said.

Speaking at an international conference on cross-border fraud in Dublin, the DPP warned of a number of smuggling issues that are hurting revenue intake.

Cigarettes were usually sourced from foreign countries, including the Far East and the Middle East, by gangs operating in border areas who had outlets to store stashes of tobacco.

Seizures of illegal tobacco more than doubled last year, with customs seizing 134 million cigarettes. These were valued at €54.3m.

"Despite huge increases in Customs seizures, it has been estimated that illegal tobacco could account for a quarter of all cigarettes smoked in Ireland," revealed the DPP.

The smuggling of counterfeit cigarettes had also become a problem, conference attendees were told.

"These are usually sourced in the Far East and pose additional hazards for the user in that they do not conform to any manufacturing standards," said Mr Hamilton.

Similar problems also existed with fake alcohol products. The alcohol fraud involved the smuggling of products from the North into the Republic as well as the sale of counterfeit drink.

The conference was attended by foreign police as well as prosecutors from 26 EU countries.

Mr Hamilton also raised issues about fuel fraud and the smuggling of petrol and diesel across borders.

"Environmental issues have arisen from the waste products of the illegal laundering industry."

This story appeared in the printed version of the Irish Examiner Friday, March 20, 2009