The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

A MAJOR importer believes the high 200 per cent tariff on tobacco imports is encouraging smugglers, telling Tribune Business that while proper controls were necessary the Government should look at reducing the tax rate.

Prime Minister Perry Christie said during his 2012-2013 Budget communication that the widespread smuggling of tobacco imports cost the Public Treasury an estimated $20 million annually.

He added that the proper control of tobacco imports, and the collection of Excise Taxes due on such products, was an area that was "fraught with leakage".

Mr Christie said: "As a means of instituting proper controls and securing excise revenues on tobacco products, the Ministry of Finance is in the process of finalising preparations, with the assistance of the Canadian Bank Note Company, for the introduction of excise stamps on all tobacco products.

"Such stamps will attest to the payment of excise taxes, facilitate audit and compliance activities to combat smuggling, and secure an important source of government revenue." While chewing tobacco is duty free, duty on fine cut tobacco is 210 per cent, cigars 200 per cent and cigarettes 210 per cent, plus a 7 per cent Stamp tax.

Philip King, owner of Smoker's Haven, said it was unfair that the Government was being shortchanged out of due taxes on tobacco imports. He added: "That's not fair to the government.

"But what theGovernment can do is lower the duty, because that 200 per cent is too high. I believe if they lower it you will find a lot of people just paying it and not trying to avoid it. To bring the products, to sell it and make a profit is difficult. I wish they could lower the duty rate on it so everyone can live. The small businessmen are the ones to really dodge around it in order to see a profit at the end of the day."