More caught for possessing illegal cigarettes as cheaper prices continue to drive black market

Contraband cigarettes seized by Singapore Customs on April 24, 2018. The agency said more people have been caught buying or possessing such cigarettes in the past year.
Contraband cigarettes seized by Singapore Customs on April 24, 2018. The agency said more people have been caught buying or possessing such cigarettes in the past year.PHOTO: FACEBOOK/SINGAPORE CUSTOMS

SINGAPORE - More people have been caught buying or possessing contraband cigarettes in the past year, as the price difference between duty-paid and duty-unpaid cigarettes continues to drive demand for the latter, said the Singapore Customs.

As the authorities continue to conduct enforcement operations against contraband cigarettes, Singapore Customs statistics show that last year, 5,846 people were caught for buying or possessing contraband cigarettes. This is an increase from 5,184 in 2016 and 5,472 in 2015.

In February this year, tobacco tax went up by 10 per cent, making cigarettes at least $1 more expensive.

However, the number of people caught for peddling contraband cigarettes has decreased.

There were 309 people arrested last year, down from 437 in 2016 and 462 in 2015.

In the past years, the overall number of duty-unpaid cigarettes confiscated has remained consistent, with 2.8 million packets seized in the past two years, and 2.9 million packets in 2015.

The number of people prosecuted for cigarette offences has also decreased, with 582 last year, down from 630 in 2016 and 778 in 2015.

In response to queries from The Straits Times, a Singapore Customs spokesman said it works with law enforcement agencies at the borders to conduct enforcement to curb the smuggling of duty-unpaid cigarettes.

Inland enforcement against syndicates that supply and distribute duty-unpaid cigarettes is also done.

Contraband cigarettes do not come with the SDPC - or Singapore Duty-Paid Cigarette - mark, which was revised in 2013 to feature a series of vertical lines around the cigarette stick, in addition to the letters "SDPC".

Last year, the Singapore Customs busted four cigarette syndicates, up from three in the previous two years.

However, the authority continues to remain vigilant, as it said that contraband cigarette peddlers have become more discreet by hawking their wares in back lanes and alleys, and via social media platforms, to avoid detection.

Of the peddlers caught between 2015 and 2017, close to two-thirds were foreigners.

In March this year, a syndicate leader was handed the heaviest sentence for contraband cigarette offences in four years.

Mok Chee Kin, 50, who is stateless, was fined $30 million and jailed five years and eight months for crafting a plan to smuggle contraband cigarettes via Jurong Port into Singapore in 2016.

The spokesman said:"To suppress demand (for contraband cigarettes), Singapore Customs conducts islandwide operations - for example in the heartlands, industrial estates and the Central Business District - to enforce against street peddlers and buyers of duty-unpaid cigarettes.

"Singapore Customs also closely monitors social media platforms to clamp down on off-street cigarette peddling activities," added the spokesman.

According to those with knowledge of the illegal cigarette trade, the demand for contraband cigarettes has remained consistent over the years despite crackdowns by the authorities.

Those with knowledge of the illegal cigarette trade say the price of contraband cigarettes can be half that of duty-paid ones.

Criminal lawyer Rajan Supramaniam said he sees about one inquiry each month from clients accused of peddling duty-unpaid cigarettes.

"Peddlers are tempted by the quick profit. From what I understand, they get into the trade through word of mouth," said Mr Supramaniam, adding that he believes most of the inventory enters Singapore from countries in the region.

"More (peddlers) are also willing to take the risk because they believe the trade isn't as severe as peddling drugs."

He also said the recent hike in tobacco tax could make the black market for duty-unpaid cigarettes even more attractive.

"The dealings might become rampant, allowing the illegal cigarette trade to thrive."

He added that buyers will always be looking for a cheaper option, and in turn the trade will become even more lucrative for sellers and syndicates.

The amount of revenue collected by Singapore Customs for duty-paid cigarettes was slightly above $1 billion in the past years. About $1.1 billion was collected in 2017, a slight increase from $1.07 the previous year.

For the first four months of this year, about $446 millionhas been collected so far.