Illicit cigarettes account for nearly 60% of the SA market

It was 5% in 2009 – then came the gutting of Sars under Tom Moyane and the devastating impact of the Covid ban on cigarette sales.

South Africa’s cigarette market will be studied by organised crime syndicates for decades to come as a blueprint for market capture.

The big players used the annual increase in excise to increase the retail prices of cigarettes, thereby increasing their profit per cigarette. Expressed another way, legal cigarette sales on which taxes were paid accounted for about 14.3 billion sticks in 2022, against 19.4 billion illicit sticks.An illicit pack of 20 cigarettes sell for anything from R15 to more than R50. The excise on the pack is R21.77, which means anything selling for less than about R32 is probably illegal, say the authors of the report, Nicole Vellios and Corné van Walbeek.

Source: British Medical Journal Publishing Group ADVERTISEMENT CONTINUE READING BELOW Tax ineffective as tobacco control tool “Furthermore, the availability of illicit cigarettes makes it easy for smokers to switch to the illicit market,” it adds. The company assured Moneyweb at the time that it operates with complete transparency and paid over R2 billion a year to Sars in excise and Vat.

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