Fighting Illicit Cigarette Trade in Turkey | Prosecure™ Hasan Alsancak
Fighting illicit cigarette trade in Turkey is getting more and more critical due to its severe damage to government tax revenues and public health.
To Transparency International Turkey and Oxford Economics Combating Illicit Trade Country Spotlight: Turkey report, Turkey, is the second country after Ukraine at illicit trade in Europe. To the report, 14% of the cigarette in Turkey is through illicit trade. The high tax policy on cigarette and alcohol of the Turkish government was shown as the main reason for illicit trade in the country by the agency. In the last three years, a 7% increase has been observed at illegal cigarette trade.
There are several significant reasons for high rates of illicit trade in Turkey, such as Turkey’s geographical position between developing and developed countries, Weak border security control systems among the neighboring countries, Significant differences in tax regimes among neighboring countries, Low-income rates, High unemployment figures, Existence of historically experienced terror and organized crime groups on smuggling in the country makes it difficult to fight illicit cigarette trade.
Particularly its geographical position put Turkey in the center of many illicit trade activities, including
- Cigarettes and tobacco
- Alcoholic drinks
- Films, music and video games
- Clothing and accessories
- Medicines and pharmaceutical products
The year 2019 is particularly important for Turkey’s fighting illicit cigarette trade, because:
– First of all, Turkey has approved the international UN Protocol to Eliminate Illicit Trade in Tobacco Products “Protocol.” The approval decision for the Protocol was published in Official Gazette number 30372 on 26 March 2018. Accordingly, it took several necessary actions of the protocol in 2019.
– Secondly, Turkish law enforcement agencies, mainly police, gendarmerie, and customs, improved their strategies and operational capabilities on the subject. Law enforcement has previously focused on collecting information but choose a different set of initiatives for the next three years, including data analytics to target enforcement (66%), a priority for only 48% across the rest of Europe, as well as collaborating with international organizations on joint initiatives.
– Thirdly, the Turkish government invested TL 350 million (about 60M USD) in customs technologies against smuggling, from X-ray scanners to license plates identification systems, vehicle surveillance, and others accompanying more traditional methods like sniffer dogs and elite counter-narcotics police units.
Recent illicit cigarette seizures in 2019 once more proved that Turkish law enforcement authorities are fully aware of how critical fighting illicit cigarette trade.
According to official figures, Turkish law enforcement and customs authorities seized 9 million packs of illicit and contraband cigarettes and 76,711 e-cigarettes in the first nine months of the year 2019. For the first time, Turkey managed to bring contraband cigarette smuggling below 2%. However, it looks too optimistic, and there are contradicting seizures figures for 2019 released by international tobacco companies. In 2018, Turkey had confiscated 15.7 million packages of illicit cigarettes. Hitting 21% in 2014, the rate of illegal tobacco in the country recorded a gradual decline over the past few years and fell to 5.8% in 2018.
To Prosecure Anti-illicit Trade (AIT) Analysists, one of the other major reasons for the decrease in cigarette smuggling in Turkey is smokers preferring macaron and ‘loose tobacco’ instead of buying more expensive contrabands. One pack of a rolling cigarette is 5-6 TL while the cheapest illicit and contraband cigarette price is about 8-10 TL in Turkey as of December 2019. It is common to see tobacco shops in every city in Turkey selling loose tobacco products even in luxurious locations.
The ‘macaron’ is a NEW TREND in Turkey and its neighboring countries, which are empty filter cigarette tubes ready to fill them with local cheap and good quality tobacco. Selling or buying macaron is legal in Turkey, but selling macarons after filing sticks with tobacco in the tobacco shops is illegal since it becomes a filter cigarette. Due to several reasons, there is a major shift from illicit, contraband, and counterfeit cigarette to rolled filtered illicit cigarettes.
Turkish tobacco authority TAPDK gives licenses to private companies to produce macarons in Turkey. There are already around ten macaron factories in Turkey, mainly located in Mersin and Adana.
Illicit and contraband cigarette in the country increased after Turkey stepped up anti-smoking measures, including a comprehensive indoor smoking ban introduced in 2009 and higher taxes for tobacco products.
The minister said tobacco products make up a majority of seizures in terms of amount, at customs. “By the end of September 2019, customs officials seized about 9 million packages of cigarettes not bearing the seal of TAPDK (the government’s tobacco and alcohol inspection board).
Please visit our website at Anti-illicit Cigarette and Illegal Tobacco Investigations to see our capabilities on the subject.