In a recent operation conducted on October 11 in French Road, Lavender, Singaporean authorities uncovered and seized a total of 53 cartons and 46 packets of duty-unpaid cigarettes. A Singaporean man is currently under investigation, according to the Singapore Customs.
The operation was led by Singapore Customs, and it has raised concerns about the widespread issue of illicit cigarette sales in the area.
Prevalence of Smuggling
According to Lianhe Zaobao, the sale of duty-unpaid cigarettes has reportedly been going on in Lavender, and there are reportedly about 6 to 7 elderly people illegally peddling the duty-unpaid cigarettes to their regular customers, of whom most of them are elderly as well.
One of the reasons for the high demand for duty-unpaid cigarettes is the significant difference in prices. These smuggled cigarettes are priced at approximately half the cost of legally retailed cigarettes, which can go as high as $16 per pack for premium brands.
Taxation Impact
Singapore implemented a 15% tax hike on all tobacco products in February, resulting in increased prices for legally sold cigarettes. The surge in prices might have contributed to the rising demand for cheaper, duty-unpaid alternatives.
Singapore Customs’ data indicates an alarming increase in the number of duty-unpaid cigarette offenders caught in recent years.
The numbers have surged from 4,963 in 2021 to 7,869 in 2022, and 6,300 during the first half of 2023.
In 2022 alone, about 2.16 million packets of duty-unpaid cigarettes were seized bu authorities. In comparison, the first half of this year had already seen about 1.36 million packets of illegal cigarettes being seized.
Enforcement Efforts
In response to this issue, Singapore Customs has been conducting regular patrols and operations to curb these illicit activities.
They are also collaborating with other enforcement agencies in joint operations to tackle the problem at its roots.
Legal Consequences
The law in Singapore is clear – it is illegal to buy, sell, deliver, store, or possess duty-unpaid goods, including cigarettes.
Offenders can face severe penalties, including fines of up to 40 times the amount of duty and goods and services tax (GST) evaded, imprisonment for up to six years, or a combination of both.
Even first-time buyers caught with a single packet of duty-unpaid cigarettes will receive a composition fine of $500.
For repeat offenders or those found with multiple packets, the penalties escalate, leading to higher fines or court prosecution. Peddlers of duty-unpaid cigarettes will also face prosecution according to Singapore Customs.