CAPE TOWN –Data collected by the Research Unit on the Economics of Excisable Products (REEP) at the University of Cape Town shows that close to 93 percent of South Africa’s smokers are still lighting up despite the national ban on the sale of cigarettes.
The ban on tobacco was put in place on March 27 for health reasons with minister Nkosazana Dlamini-Zuma adding that it would also encourage smokers to quit.
However, according to the British American Tobacco SA (BATSA) the ban has only been successful in handing over trade to criminal enterprises with the government losing billions in tax revenue.
“The market has been completely taken over by illicit cigarette suppliers at the expense of law-abiding and tax compliant manufacturers, and the fiscus continues to lose R35 million in taxes every single day,” said BATSA.
“The ban on tobacco products sales has now cost over R4 billion in excise taxes alone and substantial job losses.”
Meanwhile, REEP researchers found additional problems caused by the ban with a 430 percent increase in the number of people sharing cigarettes, exposing themselves to getting infected.
“We predict that once the sales ban is lifted, there will be a price war, in which the multinationals will aim to get some of their market shares back and the non-multinational companies will aim to hold on to their markets.
“The resulting price decrease will be detrimental to public health,” the researchers said
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