Tanzania: Police, Taxmen Impound Smuggled Cigarettes

Source from:  Tanzania Daily News 02/02/2015

Police in collaboration with trade and tax officials have arrested three people in unlawful possession of smuggled cigarettes worth billions shillings in Mbagala area, Dar es Salaam.

The trio was arrested by the police, TRA and Fair Competition Commission (FCC) officials at various places in Mbagala stocking and selling nontax paid cigarettes, said Assistant Commissioner of Police, Mr Simon Siro.

He named the suspects and added that they would appear in court soon. They are Efeso Tweve, Omary Metson and Frank Mrema. Upon conviction the suspects could face up to 15 years in jail or 50m/- fine.

Industry experts blamed increased incidents of smuggling to higher excise and import duty. They said four per cent of all cigarettes sold in Tanzania last year worth 30bn/- were smuggled into the country mostly from neighbouring Democratic Republic of Congo (DRC) and Zambia.

The volume of smuggled cigarettes was up by two per cent compared to 2012 statistics. At current excise duty and VAT rates (36 per cent of the retail value), the tax revenue loss to the government is over 10bn/-.

About 200 million cigarette pieces confiscated by the Police Force and TRA in various operations around the country last year, suggest that wellorganised syndicates could be involved.

Tanzania Cigarette Company Corporate Affairs and Communications Director, Mr Paul Makanza, said that excessive excise duty lead to low tax collection.

Mr Makanza said that with average daily disposable incomes of just under 2,500/- which is equivalent to a price of a packet of cigarettes, most consumers cannot afford to buy a pack of cigarettes. "As a result, they tend to seek cheaper alternatives, including illicit cigarettes.

Once consumers have a regular source of supply of illicit tobacco products it becomes difficult to get them away from smuggled products," he said.

TCC Company Services and Security Director, Mr Frank Usiri, commended the Police Force and the TRA for conducting country wide crack-downs on contraband products and called on authorities to apply the full might of the law on perpetrators. Enditem