SARS destroys illicit cigarettes valued at R43m

Tuesday, June 13, 2023

The Customs Division of the South African Revenue Service (SARS) has begun to destroy illicit and smuggled cigarettes, valued at R43 million, at the Beitbridge border post.

In a statement on Monday, SARS Deputy Commissioner, Johnstone Makhubu, said 2 000 master cases (or 20 million) cigarettes will be destroyed and that destruction of the illicit and smuggled cigarettes is likely to last a few days.

The illicit and smuggled cigarettes were seized in multi-agency and intelligence-driven operations as part of the Customs division’s tobacco strategy, led by its National Rapid Response Team. These efforts are supported by the South African National Defence Force (SANDF), the South African Police Service (SAPS) and its Hawks unit, as well as the Immigration division of the Department of Home Affairs.

Makhubu said that in one such operation in February this year at the Beitbridge border post:

  • A total of 1 211 master boxes of illicit cigarettes (with the brands of Remington Gold, Chelsea and Royal Express), with an estimated value of R26 million, were seized.
  • Four people were arrested and criminal cases were opened with regard to dealing in the smuggling of illicit cigarettes.
  • Four trucks, one bakkie and one tractor with a trailer, which were used to carry the illicit cigarettes (with an estimated value of over R3 million) were detained.

“SARS has a zero tolerance for persons or organisations that are involved in tax crime or illicit trade, and  SARS will pursue them relentlessly,” Makhubu said.

Illicit trade robs the government of much-needed revenue and destroys industries, exacerbating unemployment, poverty and inequality.

The illicit products, which are being imported or exported, include second hand motor vehicles, poultry, clothing, leather and textiles, essential infrastructure (copper and steel) and gold, among others.

An inter-agency working group (IAWG) has been set up to deal with all aspects of illicit trade.

SARS Director of Customs and Excise, Beyers Theron, said that as part of its far-sighted planning, Customs has put in place measures to grant benefits to compliant traders through the Accredited Economic Operator Model.

These benefits include cost-savings and quicker turnaround times, amongst others. Similarly, SARS is busy implementing SMART border technology to increase its detection capability and response to non-compliance.

“Since the inception of its coordinated and focused investigations Customs has been conducting over the past three years in the tobacco and cigarette industry, there has been a noticeable shift to increased cross-border smuggling using  'runners'. These are not individuals smuggling these cigarettes as an entrepreneurial opportunity but organised criminal syndicates exploiting the unemployed and the poor by employing individuals as runners to carry goods, often for miles, across borders.

“These runners carry at least two master cases of illicit cigarettes on their backs per run, often repeating these trips multiple times. These cigarettes are then loaded into trucks, small goods vehicles, cars and taxis that wait at locations along the border for distribution to their intended destinations on the local market,” Theron said. –