| Date: |
22-09-2015 |
| Subject: |
Foreign cigarette smugglers make hay thanks to demand |
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VIJAYAWADA: The city is fast becoming a transit point for foreign cigarette smugglers. In the past couple of weeks, the customs preventive commissionerate (CPC) here seized 4,440 cartons of foreign cigarettes worth Rs 70.20 lakh during four different operations which were conducted in East Godavari, West Godavari, Krishna and Guntur districts.
It seems that smugglers are profiting mainly because of the high customs and excise duties on imported cigarettes. Besides, there has been an increasing demand particularly among youth in the district.
Import duty as high as 90 per cent and Arun Jaitley's announcement in the 2015-16 budget about hiking the excise duty by 25 per cent have not only led to an increase in domestic prices but also made smuggling of cigarettes all the more lucrative.
"Until 2014, cigarette smuggling was miniscule in terms of quantity and value but this year it has increased manifold," said a source in the customs department. A FICCI estimate pegged the revenue loss caused by illegal cigarettes to the exchequer at Rs 9,000 crore every year. The source revealed that foreign-made cigarettes are much sought after by youngsters and smoking foreign cigarette has become a fad in rural and semi-urban areas apart from cities.
According to a senior official at the CPC in Autonagar, cigarettes can be imported under open general licence, a permit that does not impose any export obligation on the importer after payment of the relevant duty. "Hefty customs duty (Rs 7.50 per cigarette on an average) prompts traders to smuggle these tobacco products into India to avoid the indirect tax," he observed.
As for the modus operandi, the official said that cigarettes are illegally brought in as personal baggage or through door-to-door courier services mostly from Dubai and other UAE cities. The department believes that well organised gangs are involved.
"They employ paid carriers who make frequent return trips to UAE staying there for just 2-3 days. A leading airlines even accorded frequent flier status to many of the agents who reach either Chennai or Hyderabad. From there they come to Vijayawada via private transport. In some of the cases even sea route is being used but the volumes are negligible," the official said.
It has been reliably learnt that the favourite brand with the smugglers is Gudang Garam - an aromatic flavoured cigarette made in Indonesia. The brand constitutes around 80 per cent of the illegal cigarettes smuggled through the airport with foreign brands like 555 and Marlboro making up the rest.
The clove, mint, and cardamom flavoured sticks commands a premium in the markets, especially in rainy and winter season. City youth have been smoking up this spice flavoured cigarette that is available at every nook and corner. Industry sources say a carton of Gudang Garam could fetch Rs 1,300.
Meanwhile, law enforcement authorities pointed out the existing customs law does not allow the arrest of the offender as the value of smuggled goods is less than Rs 5 lakh. Customs can only fine them and confiscate the goods.
Source : timesofindia.indiatimes.com
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