Odelwell, Minister of Revenue and Financial Services (Sydney Morning Herald)
According to the Sydney Morning Herald, untested imported tobacco, illegal tobacco, commonly known as "chop" in English, and the growing black market for stolen and tax-evading tobacco have cost the federal government billions of dollars in revenue. Tan Bao (Malcolm Turnbull) government now announced plans to crack down on the recovery of funds.
Illegal cigarette trade has flourished, costing a billion Australian dollars a year in taxes, while illegitimate proceeds are used to finance other criminal activities, according to Kelly Owyer, minister of revenue and financial services.
It is estimated that there are 864 tons of illegal tobacco tax evasion every year. Government plans to recover A $3.6 billion in revenue over the next four years through a series of new measures.
The Australian Inland Revenue Service (ATO) will be given greater authority to collect tobacco taxes and other taxes on imported cigarettes. In addition, Tuesday`s budget will officially announce the creation of an interdepartmental tobacco task force, the (Tobacco Taskforce), to crack down on gangs and organized criminals who sell large quantities of cigarettes into the black market. The task force, led by the Australian Border Defense Agency (ABF), aims to enforce tightened regulations to "destroy the illegal tobacco supply chain".
Authorities believe there is a large transfer of tobacco from tobacco warehouses to the black market. Part of the theft may have been committed by employees, and large-scale transfers are on the rise. To plug the loophole, the regulatory framework will be strengthened to ensure the integrity of the tobacco tax system, and the Inland Revenue Department will receive new resources to deal with the supply of domestic cultivation used in illicit tobacco trade.
Government said it was estimated that 98 tons of illegal tobacco had been seized in the current fiscal year alone; once sold, the tobacco would cost nearly A $90 million in financial losses. In the previous fiscal year, the Inland Revenue Department seized 117 tons of illegal tobacco. It is estimated that the total value of tobacco tax also reached A $90 million.
Because criminals operating in the black market use the proceeds of trafficking to finance other illegal acts, illegal tobacco needs to be dealt with more severely, Odelwell said.
"the illicit tobacco market is dominated by organized criminal groups that use tobacco profits to finance other crimes and black economic activities," she said. And government`s favourable new measures will put an end to organized criminal groups` access to illicit tobacco to finance criminal activities. "
