Other Risks
Increasing tobacco excise is likely to increase incentives for trade in illicit tobacco in three areas:
- Smaller-scale abuse of:
- duty-free concessions for tobacco imported for personal use by international travellers;
- the duty-free allowance for gifts sent by post – currently $110, including tobacco; and
- undeclared tobacco products sent by post
- Larger-scale illegal importation of tobacco products (including "counterfeit" branded tobacco products)
- Sale of illicit domestically-grown tobacco.
New Zealand's geographic isolation, border control systems and climate mean the risks of large-scale smuggling and illicit domestic manufacture are comparatively low. These risks were assessed by The New Zealand Customs Service in 2010 following the previous round of excise increases, and Customs continues to monitor illicit tobacco in cooperation with the Police.
Abuse of personal duty free tobacco concessions and postal gift allowances is likely to rise with further excise increases. These will generally be small scale offences such as travellers attempting to bring in one or two packages of cigarettes in excess of their duty free allowance, and/or repeated posting of tobacco as "gifts" that are then on-sold. There may also be an increase in organised abuses of duty-free concessions, such as arranging for groups of travellers to pass tobacco purchased for personal use to others for black market sale.[12]
Notes
- [12]"Out of the Shadows" Report on New Zealand's illicit tobacco market, by Ernst and Young, commissioned by British American Tobacco, March 2010
