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Gleeson: Penalties For Illicit Tobacco Trading 'Are So Low, They Are Ridiculous'

Published on Apr 1 2014 4:48 PM in Supply Chain

Gleeson: Penalties For Illicit Tobacco Trading 'Are So Low, They Are Ridiculous'

Retail Ireland chairman Frank Gleeson has told a retail conference that for as long as the penalties for importing illicit tobacco into Ireland remain at a "ridiculous" level, the issue will persist.

“Penalties for illicit tobacco smuggling are so low they are ridiculous," Gleeson explained at the Grant Thornton Illict Trade Conference, held last week in Dublin.

"Fines must be increased and executed through the courts: for example, the average fine in 2013 was €2,600. This is not acting as a deterrent to criminal gangs, who are reportedly generating profits of up to €3 million per week”.

Gleeson said that the government's planned plain packaging legislation will only serve to drive consumers towards illicit products. Rather, he suggests tackling 'legal' travel imports: "Why not look at stopping people from bringing suitcases of tobacco from Latvia? We all know it's not coming in for personal consumption," he explained. "That's something the government could do immediately, and it would reduce illicit trade by 8% - 10%."

Gleeson also suggested making the purchase of counterfeit tobacco an offence, as is currently the case in Singapore, another measure that could be enacted relatively easily. "If there is a consequence to purchasing counterfeit tobacco, it acts as a deterrent. Is there any reason why it can't be brought in here?"

Last week's conference marked the publication of a report on the illicit trade in Ireland: "Illicit Trade, An Irish And Global Challenge", published by Grant Thornton. A survey carried out for the report found 77% of retailers believe their revenue decreases as a result of illicit trade in tobacco, while 45% believe that the introduction of plain packaging could lead to a high increase in illicit trade.

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