A ban on the sale of cigarettes in South Africa since the country’s COVID-19-induced lockdown began in March has cost the economy millions of rands daily in the form of tax revenue lost to illicit sales of smokes, a variety of industry officials say.
This comes after the South African government had banned the sale of tobacco and alcohol as part of a nationwide lockdown to contain the spread of a deadly corona virus. COVID-19, the infectious disease caused by the new corona virus, has claimed the lives of 1,480 people in the country as of June 15, according to data compiled by Johns Hopkins University.
South Africa Tobacco Transformation Alliance chairperson Ntando Shadrack Sibisi said millions of rands were being lost to illicit sales by the the South African Revenue Service daily. “SARS is losing R36-million ($2.1 million U.S.) per day in excise revenue since the lockdown started, which amounts to R1.5 billion a month,” Sibisi said, approximately $87 million.
He said the livelihoods of more than 8,000 South Africans involved in tobacco growing, processing and manufacturing—and their 30,000 dependents—were at risk because of what he described as “black market cigarette barons” operating in the country.
The alliance represents players involved in the tobacco value chain—farming, processing and manufacturing industries—in the country’s five tobacco-growing provinces committed to transformation and economic development. Sibisi said the illicit trade of cigarettes had increased significantly in