HMT /C&E 1
22 March 2000
TOBACCO SMUGGLERS TOLD - YOUR TIME IS UP
A massive £209 million clampdown on tobacco smugglers was announced today by Paymaster General Dawn Primarolo.
‘Tackling Tobacco Smuggling’, the Government’s anti-smuggling strategy published today, sets out the new package which includes:
- nearly 1000 more Customs officers, working at ports and inland
- additional specialist investigators and intelligence staff
- additional x-ray scanners
- tougher sanctions and penalties
- a public awareness campaign.
As a result of these measures, Customs will reverse the trend in tobacco smuggling within three years, and in the process will:
- seize over 10 billion cigarettes;
- break up 180 smuggling gangs;
- seize £50 million of criminal assets;
- collect an additional £2.3 billion in tax revenue which will be available for priority services.
Ms Primarolo said:
“Tobacco smuggling is unacceptable – it undermines our aim to reduce smoking, which is the single greatest cause of preventable premature death in this country. It denies honest taxpayers the money for high quality public services. And it has disturbing links to other serious criminal activity.
“This £209 million package will put nearly 1000 more Customs officers on the front line, providing them with the best technology and the most effective sanctions to combat and defeat tobacco smugglers. Our aim is to reverse the trend in cigarette smuggling over three years, and in the longer term get smuggling below current levels.
“All those involved in tobacco smuggling – from the smugglers to the distributors – should be under no illusions. We will catch you, we will seize your smuggled goods and the vehicles you use, and we will punish you with the most severe penalties. Your time is up.”
Customs and Excise Chairman, Richard Broadbent said:
“We will disrupt cigarette and tobacco smuggling and catch the people responsible. We will put more staff at ports and around the country. We will invest in technology, including large-scale x-ray scanners which can look inside lorries and freight containers. We will invest in intelligence and investigation, which is a critical part of the job. These resources will make a significant impact.”
Public Health Minister Yvette Cooper said:
“Smoking kills over 120,000 people in the UK every year. We are committed to reducing this number of premature deaths - 70 per cent of smokers say they want to give up.
“Evidence shows that anti-smoking strategies need to be comprehensive and cross-Government if they are to succeed. There is a strong health case for year-on-year real terms increases in the price of cigarettes and tobacco to support our objectives and we welcome the Chancellor’s decision to continue with tax increases in this Budget.
“Increasing taxes, cutting smuggling and offering new support and advice to smokers who want to give up will have a huge impact on cutting smoking related deaths and improving the health of thousands.”
NOTES FOR EDITORS
Current estimates are that 1 in 5 cigarettes smoked in the UK are smuggled. The availability of cheaper smuggled cigarettes increases total cigarette consumption. This undermines the Government’s health objective of reducing smoking which kills over 120,000 people every year. Without action it is estimated that as many 1 cigarette out of 3 could be smuggled in the near future.
The Chancellor commissioned Martin Taylor to evaluate the way in which tobacco smuggling was being combatted. He reported in November 1999 and recommended measures to increase detection; measures to increase the risk and reduce the reward for smugglers; and measures to act on the public perception.
The Government published its anti-smuggling strategy today in response to Martin Taylor’s advice. The strategy aims to increase massively the chances of those involved in smuggling getting caught and hitting criminals with severe penalties.
The Government is committing up to £209 million over the next three years to tackle smuggling. Funding for the full strategy consists of:
- £90 million extra funding for Customs to be spread over the next three years, announced for the first time today;
- £23 million from the capital modernisation fund, as set out in the PBR;
- £96 million provisionally set aside for 2001-02 and 2002-03, following the conclusions of reviews of cooperation between law enforcement agencies (part of the Spending Review 2000).
- increasing the number of seizures all along the supply chain;
- improving intelligence to optimise interception rates and disrupt inland distribution;
- targeting measures to apply effective sanctions to those involved in inland distribution;
- increasing use of asset confiscation to remove the economic rewards of smuggling;
- enhancing inter-agency working at home and abroad;
- deploying extra resources – both human and technological;
-ensuring the public and potential smugglers are in no doubt about the consequences of their actions.
The Government’s investment will put up to nearly 1000 more frontline staff to tackle tobacco smuggling:-
- 520 extra staff in key locations. They will work in high risk border and inland locations increasing Customs anti-smuggling activities, 170 of whom will be dedicated to combatting smuggling at the Channel ports;
- 95 intelligence staff will be located both in the UK and overseas;
- 310 investigation staff will break up the large scale organised smuggling gangs;
- 30 more will be in Customs Solicitors Office to handle increase in commercial fraud cases.
This investment – together with the measures announced in the Pre Budget Report such as the introduction of cigarette and tobacco pack marks –will reverse the upward trend in cigarette smuggling into the UK within three years and in the longer term have smuggling below current levels. Compared with taking no action, the strategy will reduce smuggling by over a third by 2002-3.
It will support the Government’s objective to reduce levels of smoking which causes over 120,000 deaths every year. It will also tackle the serious criminality around tobacco smuggling. It will raise £2.3 billion of revenue over three years - including indirect effects this increases to over £3 billion over three years.
The Government has also announced further details of the national network of x-ray scanners. These scanners will be a mixture of permanent, relocatable and mobile scanners. Scanners will make apparent to Customs concealments of cigarettes (and other contraband) in minutes rather than hours. This will substantially increase successful interception of smuggled cigarettes by allowing more examinations of high risk or targeted traffic.
NEW, HARDER PENALTIES
These additional resources will be supported by new, harder sanctions and penalties as indicated in the Pre-Budget Report.. This will include, from 1 April 2001, a compulsory pack mark on tobacco products clearly indicating that UK duty has been paid. Pack marks will make identification of smuggled tobacco easier. Anyone buying or selling tobacco will know immediately whether they are dealing with legitimate goods and it will make it easier for the police and trading standards officers to help Customs in their enforcement role.
New offences will enable quick and effective prosecution of anyone found selling or dealing in unmarked tobacco. At the same time new criminal offences subject to a fine of up to £5000 will be introduced for possessing, selling or dealing in unmarked cigarettes and hand-rolling tobacco or permitting premises to be used for such activity. A technical note on the details of pack marks has been published today (Customs and Excise Business Brief 5/2000) and a Regulatory Impact Assessment will be published with Finance Bill 2000.
The investment will also provide an increase in the yield from tobacco taxes as the illicit market reduces. The estimates of the extra direct and indirect yield are shown below:
Press copies of ‘Tackling Tobacco Smuggling’ can be obtained from the Press Office.
HM TREASURY PRESS OFFICE
Press Enquiries to: 0171 270 5238
Non-media enquiries to: 0171 270 4558
Press enquiries only to HM Customs and Excise, Communications Division, New King’s Beam House, 22 Upper Ground, London, SE1 9PJ.
Telephone: 0171 - 865 5471/5472/5872/5335, or to regional Public Relations Officers.
Others should contact their local Excise and Inland Customs Business advice Centre, listed under Customs and Excise in the telephone book. Customs and Excise Internet address: http://www.open.gov.uk/customs/c&ehome.htm
If you have access to the Internet you can find this news release at www.hm-treasury.gov.uk. Other Treasury material can also be found at this address.