JTI has presented further evidence to MPs on the scale of the illegal tobacco and vape trade and called for stronger powers and additional funding for trading standards to tackle the issue.
Test purchasing recently undertaken for JTI has gathered evidence on 95 stores in north-west England selling illegal cigarettes, hand-rolling tobacco, and vapes. This is the first time that vaping products have also been added to these test purchasing activities. Counterfeit versions of a JTI hand-rolling tobacco brand were found for £4, compared to a retail price of £29, and each pack sold saw the government lose out on approximately £20 in taxes. One of the retail locations identified had been actively selling illegal tobacco since 2015.
JTI research shows that in the past month, more than a third of smokers have bought tobacco products that were not in the plain packs legally required in the UK.
Ian Howell, Fiscal and Regulatory Affairs Manager at JTI, said: “While Border Force prevents the smuggling of illicit tobacco into the country and HMRC conducts large-scale operations that can lead to the uncovering of major illegal manufacturing sites, it is trading standards that undertake the lion’s share of enforcement action on the UK’s high streets.
“Unfortunately, despite efforts such as Operation CeCe or the Keep It Out campaign, trading standards is overwhelmed by the scale of the problem. They do not have access to easy-to-apply, hard-hitting financial sanctions that would help tackle the persistent actions of rogue retailers who are currently undeterred.”
Using the framework of tobacco track & trace – effectively a form of licencing that requires any business trading in the tobacco sector to register with HMRC – the Finance Act 2022 gave HMRC the ability to issue on-the-spot fines of up to £10,000 and suspend any required registration in the event of wrong-doing.
“During the consultation process, HMRC promised that these powers would be extended to Trading Standards, but the method and timeframe to accomplish this has not yet appeared. Without this, the criminals selling illegal tobacco will simply carry on regardless,” added Howell.
“JTI is calling for HMRC to extend these powers to trading standards, and for the Treasury to allow trading standards to retain the money raised through these penalties to re-invest in their services. Criminals should be made to pay the price for their criminal activity, not taxpayers.”
