Since the Health and Welfare Surcharge on tobacco was implemented in 2002, the smuggling of small cigarette brands is getting a lot more serious, according to
Taiwan Tobacco & Liquor Corporation (TTLC).
Illegal cigarette sellers first created their own brand of cigarette, and got the cigarettes manufactured in the Mainland and other Asian countries. They imported a small proportion of the cigarettes into Taiwan through legal means, and smuggled the rest.
When the smugglers were questioned, they could provide proof that their cigarettes were registered and were sold legally. Also, the majority of these cigarettes were sold at betel nut stalls and night markets. It was hard for the customs offices to find enough evidence to prosecute the illegal groups.
TTLC believes that these illegal tobaccos have a market share of almost 10 percent.
In the past, most illegal cigarettes were counterfeited cigarettes selling under well-known brands. However, once they were caught, the smugglers had to face criminal charges and also had to pay the cigarette companies for their losses. By the new way, they can avoid both charges.
Custom offices estimated that more than NT$5 billion of tobacco tax was evaded through cigarette smuggling each year. For every pack of illegal cigarettes sold, NT$35 tax income was lost. In 2009, 10.27 million packs of tobacco were confiscated, 5.81 million more than 2008, accounting a 130 percent increase.
On Feb. 8, Taichung Custom Office had found smuggled cigarettes valued at NT$50 million, the biggest cigarette-smuggling case in 10 years.
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