Illegal tobacco trade court ruling: Taxpayers ‘robbed’ of R5bn

When the tobacco ban was announced at the start of the Covid-19 lockdown, people across the country were outraged – and not just the smokers, either. Many feared (and rightly so) that the economy would suffer, as the tax generated from the tobacco trade is significant. According to Tax Justice SA, South Africa lost over R5bn in taxes ‘while criminals trading illegally were making R100m everyday’. The prohibition was supposed to stop anyone from buying cigarettes – but it didn’t. In fact, it welcomed – and nurtured – an illegal market which, says Yusuf Abramjee, ‘is now the biggest in the world’. He says the 144-day ban was ‘a gift for criminals’ and that the ‘government has created this monster’. The High Court has ruled that the tobacco ban was unconstitutional and unnecessary. Abramjee adds that ‘the High Court ruling means R5bn was robbed from South Africans for no legal reason’. – Jarryd Neves

Use Spotify? Access BizNews podcasts here.

Use Apple Podcasts? Access BizNews podcasts here.

Tax Justice SA (TJSA) media statement:

The High Court’s recent landmark judgment that the lockdown tobacco ban was unconstitutional and not necessary compels authorities to now crack down on the criminals in illicit trade who are still looting us of billions, Tax Justice SA (TJSA) says.

TJSA founder Yusuf Abramjee says: “The High Court ruling means that R5 billion was robbed from South Africans for no legal reason.”

“What urgently needs to happen now is that all the forces of the state be dedicated to driving out the criminals who not only profited from the ban but continue to profit from the lawless environment it’s created.”

“Millions of previously law-abiding smokers were driven to buy from the illegal market, which is now the biggest in the world. The criminals in this market paid no tax during lockdown and they’re not paying any tax now.”

“We fear that six out of every 10 cigarettes is now illicit and that criminals in the trade are daily pocketing over R30 million that should be spent building a better SA.”

“The government has created this monster and it is the government’s responsibility to stop it destroying jobs, impoverishing communities and ruining our economy.”

Throughout the 144-day ban on the sale of cigarettes, TJSA warned it was robbing the country of R5,04 billion in lost tobacco excise taxes alone, while criminals trading illegally were making R100 million every day.

Abramjee, who filed an affidavit to support the High Court application, says: “The ban was a gift for criminals, but this judgment is a victory for TJSA and all honest, hard-working South Africans. We should never tolerate a system where crime is allowed to pay.”

Also read:

(Visited 1,138 times, 4 visits today)