It’s easy: you can spot illegal cigarettes by their price.
The minimum collectable tax on a pack of 20 cigarettes is R16.30. Of this, R14.30 constitutes excise, plus R2.00 of VAT on excise. Any pack of 20 sold below R16.30 may be an indication that the above taxes have not been paid, which is a contravention of the Customs and Excise and the Income Tax Acts. Most illegal cigarettes are sold at R10 a packet – significantly below the minimum collectable tax.
The sale of illicit cigarettes undermines carefully determined tax policy by reducing the sale price of cigarettes. Excise tax on tobacco plays a crucial part in a pricing policy that is aimed at reducing the affordability, and hence demand, of cigarettes. That means that illegal cigarettes are more easily accessible to young people under the legal smoking age of 18 years.
Fake cigarettes can be almost impossible to tell apart from their legitimate cousin (except by the price, which is a giveaway the pack’s not the real brand). Another problem is ‘look-alike’ cigarettes, where criminals mimic an original design with some changes.
Counterfeits can also be riskier to health than genuine product. Because they are not subject to the same stringent production processes, counterfeits are likely to contain many times the levels of tar and carbon monoxide found in genuine cigarettes, and in some cases can contain insects and human faeces.