$8b in revenue lost to contraband

From: New Straits Times (Singapore)

Being caught with even one stick of illicit cigarette can land a person in serious trouble with the law.

For the past one year, more than 100 people have been charged with selling or being in possession of illicit cigarettes, some with even one stick.

Almost all were let off with fines but the Customs Department is planning to take the fight against cigarette smugglers and sellers to the next level.

“We are going to press for custodial sentence against repeat offenders,” said the department’s deputy director (enforcement and compliance) Datuk Matrang Suhaili.

“We will also stop licensing those with criminal records.”

These stringent measures are part of the department’s latest endeavour, “Operation Outlet”, to stamp out illicit cigarettes from the local market.

Cigarette smugglers have caused a RM2 billion (S$800 million) leak in tax revenue for the government and has become a serious concern for law enforcement agencies.

The Customs Department is now trying to put this right.

Under “Operation Outlet”, the department will visit outlets suspected of being involved in the sale of illicit cigarettes.

Their fight now is two-pronged, stopping the supply of illicit cigarettes into the country, and going after those who have received the supply and are selling or using them.

“The directive has gone out to all state Customs offices to carry out raids every week.”

He said the results are already beginning to show, with a larger haul last year compared with the previous year.

Last year, the department uncovered 2,690 smuggling cases and confiscated 638 million cigarette sticks worth RM87 million, with RM311 million in unpaid duty.

In 2009, 522 million cigarette sticks worth RM71 million were confiscated, with RM251 million in unpaid duty.

A total of 57 retailers were charged in court for selling illicit cigarettes.

Matrang, however, said while their haul had been substantial, smugglers were becoming more innovative.

“About a decade ago, smugglers used roads and private jetties to ship in the contraband as ports then, did not handle as much cargo as it did now.

“Smugglers are now taking advantage of the high volume of consignments that come through our ports to smuggle in their goods.”

At least 20,000 containers pass through the six ports in the country every day but not all of them are examined by Customs officers.

Matrang said smugglers would declare their goods as something else when in fact they were smuggling in cigarettes.

Matrang also did not discount the fact that there were some ‘bad apples’ among Customs officials who were in cahoots with the smugglers.


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