CONTRABAND CIGARETTES COSTING PNG GOVERNMENT REVENUE

SMUGGLED cigarettes crossing borders into the PNG market, costs up to K100 million in revenue lost by the government annually.

The loss is from unpaid import duties, GST, Corporate tax and relevant taxing measures.

Michael Penrose, General Manager of British American Tobacco revealed this grim fact, claiming that the illicit trade has grown over recent years to be approximately 14% of the legal cigarette market.

It has been blamed on lax monitoring measures particularly along the PNG Indonesian border, especially in Vanimo.

Though controversial in the nature of product, BAT has notably sustained the income of those that do business selling its products in stores, markets and streets.

Most street vendors in the country make their living through cigarette resale; mostly the products of BAT.

It is understood that the illegal cigarettes are being sold at half the price of the genuine ones.

BAT has been the leading manufacturer of cigarettes, supplying its products to every region of the country, but the significant increase in the sale of illegal cigarettes, is now a concern.

Importantly, the sale of illegal cigarettes has impacted on the revenue generated by the government from legal producers.

Mr Penrose, who is the first Papua New Guinean appointed as BAT’s General Manager, said the government needs to set stringent measures to prevent further loss in revenue.

BAT is equally concerned with underage smoking, and said the government and law enforcement agencies should step up enforcement.

It is also the consumer’s choice whether to start, continue or quit the habit.

EMTV