Illicit cigarette trade flourishing during MCO period

TheStar Thu, Jul 02, 2020 10:41am - 6 months ago


It is estimated that the black economy comprised about 25% of the total trade last year, and according to Japan Tobacco International (JTI), the loss in tax revenue annually for the tobacco industry is estimated at RM5bil.

PETALING JAYA: Technology advancement not only makes trade easier but also enables illicit trade to be conducted at the fingertips.

From medicine to cigarettes and alcohol, the market segment which is also known as the black economy has grown over the past years.

It is estimated that the black economy comprised about 25% of the total trade last year, and according to Japan Tobacco International (JTI), the loss in tax revenue annually for the tobacco industry is estimated at RM5bil.

This has caused the government to lose tax revenue, especially from items listed under the sin tax such as tobacco and alcohol, amounting to almost RM10bil per year.

In an email to Bernama, JTI said that illicit trading had grown exponentially during the movement control order or MCO period, as syndicates resorted to creative online methods to ply their trade and reach end-users in light of restricted physical movements.

“This includes the use of e-commerce and social media platforms, couriers and even food delivery riders to move illicit cigarettes in open defiance of the law, ” it said.

This scenario is experienced not only in Malaysia but also globally. — Bernama






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