Sir, – Eugene Regan (Opinion Analysis, September 7th) writes that a decrease in the price of cigarettes would lead to a reduction in illicit tobacco trade without having a significant effect on the level of smoking in Ireland. This is not the case.
Mr Regan refers to a recent report by EPS Consulting, which estimated that €526 million of revenue is lost each year because of tobacco smuggling. This figure is based on inaccurate data. The Revenue Commissioners and the Department of Finance have found that 14 per cent of cigarettes smoked in Ireland are smuggled into the country. This is an unacceptable level, but it is 10 per cent lower than the rate claimed by tobacco industry sources in the EPS Consulting Report. The difference in figures is because data used is supplied by the tobacco industry, which has a clear conflict of interest in supplying data of this kind.
A reduction in price is not the solution to smuggling. High levels of smuggling exist between countries with similar legitimate tobacco prices and smuggling is also a problem in many countries where tobacco taxation and prices are very low.
The price of cigarettes has a major impact on cigarette consumption. Higher prices reduce smoking rates and smoking-related illness as people cut down, quit, or never start because of the high cost. Smoking is the main cause of preventable death and disease in Ireland. It is important that we keep price high in order to encourage people to quit.
Tobacco smuggling is a problem in Ireland. The illicit tobacco trade undermines the work being done to reduce smoking rates and deprives the exchequer of much-needed revenue. However, the solution to this problem is not a reduction in price.
Smuggling is a criminal issue and needs to be treated as such. More resources are needed to tackle tobacco smuggling in Ireland. The implementation of a national strategy to reduce tobacco smuggling in the UK has reduced the illicit tobacco market from 21 per cent to 11 per cent in 10 years. We need to take a similar approach in Ireland. – Yours, etc,