Illicit cigarette, alcohol and fuel market costing SA economy

The South African government has lost around R40-billion in excise revenue to the cigarette black market since 2020.

This was revealed by Finance Minister Enoch Godogwana, who delivered the Medium-Term Budget Policy Statement (MTBPS) on Wednesday.

He said illicit alcohol and fuel also threaten the country’s economy, endanger consumers, and rob the fiscus of billions in revenue.

“The growing markets for illicit cigarettes and alcohol pose a serious risk to public health and undermine legitimate businesses,” said Godongwana.

He said, each year billions of rands in taxes go uncollected; funds that could have closed the revenue gap and avoided tax increases entirely.

“Government is clamping down on this illegal trade. In the last six months, Sars suspended three licences for non-compliant tobacco production.

“The Financial Intelligence Centre has provided intelligence reports to Sars to assist in investigations of criminal syndicates.

“Together they have identified illicit markets in tobacco, precious metals, fuel and procurement fraud,” said the finance minister.

He further urged customs officials to fulfil their duty to prevent criminals from dodging taxes and flooding SA markets with dangerous products.

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