Tuesday 18 March 2014

35,000 tobacco plants seized in Australian raid

In Australia yesterday, police carried out a dawn raid on an organised crime syndicate...

Police executed 44 search warrants at properties in a number of northern and western suburbs including Altona North, Williamstown, Truganina and Sunshine on Tuesday morning. They expect to make more arrests during the day.

More than 500 police officers, backed by other agencies, were involved in the operation, which began about 4.30am and will continue through the day.

They seized firearms, drugs, cash, ammunition, vehicles and allegedly stolen property.

But they also walked out with something else...

The haul included 100kg of dried cannabis, 35,000 tobacco plants and nine firearms, Mr Fontana said.

35,000 tobacco plants! Do you know how big tobacco plants are? Can you imagine how much room you need for 35,000 of them?

The question is why do tooled-up criminal gangs, who already have a huge stock of an illegal drug, want to farm enormous quantities of a product that you can buy over the counter?

He said tobacco plants, which were seized from a property near Geelong, were grown to avoid millions of dollars in excise tax.

No fooling. I guess having a Prohibition-era problem with black market tobacco is a small price to pay for being a 'world leader' in tobacco control and getting a gong from the WHO.*

This madness has to stop. Australia has brought it on themselves, but governments elsewhere should let the shipwrecks of others be their landmark.

* Tobacco control assures us that there is no connection between eye-wateringly high tobacco taxes and the growth of the black market, so everything's okay, you can go back to sleep. They would never lie to you. They're professionals.


Anonymous said...


Cigarette Taxes and Cigarette Smuggling by State

Key Findings
•Large differentials in cigarette taxes across states create incentives for black market sales.
•Smuggled cigarettes make up substantial portions of cigarette consumption in many states, and greater than 25 percent of consumption in twelve states.
•The highest inbound cigarette smuggling rates are in New York (56.9 percent), Arizona (51.5 percent), New Mexico (48.1 percent), Washington (48 percent), and Wisconsin (34.6 percent).
•The highest outbound smuggling rates are in New Hampshire (24.2 percent), Wyoming (22.3 percent), Idaho (21.3 percent), Virginia (21.1 percent), and Delaware (20.9 percent).
•Cigarette tax rates increased in 30 states and the District of Columbia between 2006 and 2012.

Public policies often have unintended consequences that outweigh their benefits. One consequence of high state cigarette tax rates has been increased smuggling as criminals procure discounted packs from low-tax states to sell in high-tax states. Growing cigarette tax differentials have made cigarette smuggling both a national problem and a lucrative criminal enterprise.

Each year, scholars at the Mackinac Center for Public Policy, a Michigan think tank, use a statistical analysis of available data to estimate smuggling rates for each state.[1] Their most recent report uses 2012 data and finds that smuggling rates generally rise in states after they adopt large cigarette tax increases. Smuggling rates have dropped in some states, however, often where neighboring states have higher cigarette tax rates. Table 1 shows the data for each state, comparing 2012 and 2006 smuggling rates and tax changes.

New York is the highest net importer of smuggled cigarettes, totaling 56.9 percent of the total cigarette market in the state. New York also has the highest state cigarette tax ($4.35 per pack), not counting the local New York City cigarette tax (an additional $1.50 per pack). Smuggling in New York has risen sharply since 2006 (+59 percent), as has the tax rate (+190 percent).

Other peer-reviewed studies provide support for these findings.[2] Recently, a study in Tobacco Control examined littered packs of cigarettes in five northeast cities, finding that 58.7 percent of packs did not have proper local stamps. The authors estimated 30.5 to 42.1 percent of packs were trafficked.[3]

Smuggling takes many forms: counterfeit state tax stamps, counterfeit versions of legitimate brands, hijacked trucks, or officials turning a blind eye.[4] The study’s authors, LaFaive and Nesbit, cite examples of a Maryland police officer running illicit cigarettes while on duty, a Virginia man hiring a contract killer over a cigarette smuggling dispute, and prison guards caught smuggling cigarettes into prisons. Policy responses have included banning common carrier delivery of cigarettes,[5] greater law enforcement activity on interstate roads,[6] differential tax rates near low-tax jurisdictions,[7] and cracking down on tribal reservations that sell tax-free cigarettes.[8] However, the underlying problem remains: high cigarette taxes that amount to a “price prohibition” of the product in many U.S. states.[9]

Anonymous said...

Australia Losing $1B To Tobacco Black Market, KPMG Says ...


Australia is losing AU$1 billion (US$953 million) per year in tobacco excise revenue due to a jump in black ... Australia Losing $1B To Tobacco Black Market, ...