Rs 120cr goes up in smoke due to illegal trade

From: Times of India

BHOPAL:  Madhya Pradesh has emerged as a hotbed of illegal cigarettes trade in India. High tax regime in the state prompts smuggling of cigarettes from the neighbouring states. This fact came to light at a seminar on ‘curbing counterfeiting and smuggling-an imperative for Indian economy’ held here on Monday.

The seminar was organised by the FICCI-CASCADE (committee against smuggling and counterfeiting activities destroying the economy) in partnership with FMPCCI (Federation of Madhya Pradesh Chambers of Commerce and Industries).

The state is one of the largest markets for illegal cigarettes in the country with the sale of over 60 million “tax-evaded” cigarettes being sold in the state every month which accounts for 30% of the total illegal cigarette market the country. In fact, if one combines all illegal cigarettes as one brand then it becomes the second largest brand in the state.

Consequently, the government suffers an annual revenue loss of around Rs 120 crores.
Inaugurating the workshop  finance minister Raghavji Bhai said stricter enforcement of laws and proper checking at the borders would curb the revenue loss.

There was also a panel discussion on intellectual property enforcement issues against smuggling and counterfeiting which included M R Krishna, additional director general of police (ADG), CID, Dr D K Verma, commissioner, customs and excise,  Bhopal, and  M N Buch, former bureaucrat.

In Madhya Pradesh, state tax on cigarettes is at high of 23% (VAT+ entry tax), thereby, giving an impetus to the inter-state smuggling and illegal trade. Several illegal brands have emerged as big players with a large consumer base, said one of the panel members.

The panel was chaired by Deep Chand, advisor FICCI CASCADE.


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