New association to fight illicit tobacco trade

The DCTA draws upon the industry's collective expertise in securing international supply chains and developing sophisticated technologies to help distinguish genuine product from counterfeit.

Eliminating the illicit trade in cigarettes and alcohol requires international cooperation and smarter tools to help customs, border and tax officials tackle the criminals who carry it out. The DCTA offers a proven, secure and cost-effective solution, based on Codentify technology, for this purpose.

The technology makes the leap into the digital age, offering quick and easy access through a mobile phone to all the information governments need to protect tax revenues, verify the legitimacy of shipments and meet international regulatory requirements, including the World Health Organisation's protocol to eliminate the illicit trade in tobacco.

Pat Heneghan, spokesperson for the DCTA, said, "Today's legal supply chains are global, complex and involve many parties. When combined with the sophistication of the criminals and terrorists who traffic illicit goods, it means national governments must use the latest advances in technology to secure supply chains if they are to make any real progress in addressing this dangerous and growing problem.

"With governments looking at ways to secure tax revenues in these austere times and crackdown on the criminals that prosper from the black market, we are certain that the DCTA can provide the technologies and expertise needed to make a real impact," he concluded.

According to independent research, it is estimated that around 12% of the global cigarette market is illicit, equivalent to some 660 billion cigarettes each year, costing national governments more than US $40 billion a year in lost tax revenues. The illicit alcohol trade is also substantial, with the World Health Organisation estimating that around 30% of all alcohol consumed globally is illegally produced or 'unrecorded'.

South Africa has not been exempt in the fight against the illicit trade in tobacco products. According to industry research conducted by independent agencies, the illegal trade in cigarettes now accounts for 30% of the total cigarette market in South Africa. The Tobacco Institute of Southern Africa (TISA) estimates that the loss to government was more than R5 billion in excise and VAT for 2012.