South Africa is facing a growing challenge from illicit trade that is severely impacting the economy and public health. A recent report highlights that the illicit alcohol industry alone is valued at R25 billion, operating covertly and undermining government revenue while posing health risks. Additionally, the illicit cigarette market in South Africa has expanded to record levels, with over 75% of retailers selling cigarettes below the minimum tax threshold, resulting in an estimated $1.6 billion annual loss in tax revenue. Overall, illicit trade activities are causing South Africa to lose approximately R28 billion in tax revenue each year, exceeding the South African Revenue Service's additional collection target of R20 billion. These issues are compounded by concerns over drug cartels and criminal syndicates infiltrating law enforcement, prompting calls for urgent action from President Cyril Ramaphosa amid ongoing police scandals.
New report shows R28bn in annual tax revenue is lost to illicit trade — more than Sars' entire additional collection target of R20bn https://t.co/E2PxIJuKvx
The availability of illicit cigarettes in SA has reached record levels, with more than three-quarters of shops selling cigarettes below the minimum tax threshold on a pack of 20. https://t.co/Jo9gAhj1NN
South Africa has become one of the world’s biggest markets for illicit cigarette sales losing around $1.6 billion a year to tax evasion, according to a new report https://t.co/IOf3I9vhLG