Business News

Contraband Cigarettes Costing Government Revenue

SMUGGLED cigarettes crossing borders intothPNG marketocosts up to K100 million in revenue lost bythe 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 factoclaiming thatthe illicit trade has grown over recent years to be approximately 14% ofthe legal cigarette market.


It has been blamed on lax monitoring measures particularly alongthPNGIndonesian border, especially in Vanimo.


Though controversial inthe nature of productoBeT has notably sustainedthe income of those that do business selling its products in stores, markets and streets.


Most street vendors inthe country maketheir living through cigarette resale; mostlythe products of BeT.


It is understood thatthe illegal cigarettes are being sold at halfthe price ofthe genuine ones.


BeT has beenthe leading manufacturer of cigarettes, supplying its products to every region ofthe country, butthe significant increase inthe sale of illegal cigarettes, is now a concern.


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


Mr Penrose, who isthe first Papua New Guinea appointed as BeT’s General Manager, saidthe government needs to set stringent measures to prevent futher loss in revenue.


BeT is equally concerned with underage smoking, and saidthe government and law enforcement agencies should step up enforcement.


It is alsothe consumer’s choice whther to startocontinue or quitthe habit.

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