37 in court for attempting to smuggle cigarettes into SA

Thirty-seven suspects who were arrested while attempting to smuggle 76 cardboard crates of export quality Remmington Gold cigarettes out of the country into South Africa appeared before Beitbridge Resident Magistrate Mr Takudzwa Gwazemba last week.

The accused were arrested last Wednesday by members of the national security task force, which is implementing an operation against cross border crimes.

Prosecuting, Mr Ronald Mugwagwa said the security men at Point 40 near Vhembe Game Park, received information that there was smuggling activities at an illegal crossing point near the same area.

They then reacted and intercepted the 37 accused persons who were crossing into South Africa carrying the cardboard crates boxes of Remington Gold cigarettes.

The boxes were neatly packed in sacks that had been improvised as satchels.

Mr Mugwagwa said the group was subsequently arrested and the contraband was taken to the Zimbabwe Revenue Authority (ZIMRA) for valuation.

The smuggling of cigarettes from Zimbabwe into South Africa through illegal crossing points along the Limpopo River relatively increased at the beginning of April last year prompting security from both countries to intensify anti-smuggling initiatives.

The market exists because of the high duties that South Africa charges, so it is possible to make a profit even buying cigarettes at retail prices in Zimbabwe.

It is understood that 30 percent of cigarettes in South Africa are from Zimbabwe with brands including Pacific, Remington gold, Mega, Dullahs, Branson, and Sevilles.

South Africa's tax watchdog, Tax Justice SA (TJSA) has accused cigarettes manufacturers in the neighbouring country of paying lip service to tax laws following the surge in tobacco smuggling.

The organisation's founder Mr Yusuf Abramjee said many shops in the neighbouring country were full of these illicit cigarettes, which rob South Africa of billions of rand in desperately needed taxes.

He said investigations by market researchers IPSOS revealed that 85 percent of GLTC-owned brands bought in the survey were sold below the minimum collectible tax rate of R21.60 per pack.

Mr Abramjee said it had also been established that every single pack of Remington Gold purchased in the survey was below the minimum and that some were sold for as little as R10.

"Most of these cigarettes are being brought in by foot, in commercial trucks, buses, and tankers, and the police, the army, and customs officials have been intercepting the smugglers at the border or various areas within the country," he said.

"The smugglers are bribing officials to bring in their loads and this is bad for the local industry. We have been engaging SARS and we are happy that they are acting on plugging the loopholes, but still want to see them do more".

Mr Abramjee also appealed to the South African government to carry out an inquiry into the smuggling and trade of illicit cigarettes.

"We need such an inquiry which will then inform the formulation of a long-term solution to this vice," he added.

Investigations by the Herald reveal that the demand for Zimbabwe's tobacco and related products by other countries has seen the establishment of well-orchestrated syndicates who facilitate the illegal trade.

While Zimbabwe exports tobacco to South Africa legally, not many manufacturerd cigarettes are exported because of the high duties. The smuggled cigarettes can easily undercut the South Africa prices if duty is not paid.

Statistics from the South African Revenue Services show that a total of 82 689 043kg of tobacco were imported from Zimbabwe between January 2010 until March 2015.

These include imports of Cigars, Cheroots, Cigarillos, and Cigarettes, of Tobacco or of Tobacco Substitutes.

Cigarettes imported from Zimbabwe pay duty at a rate of R6.21 per 10 cigarettes.