On May 16th, according to the South China Morning Post, since Hong Kong raised tobacco taxes by 31% in February, the value of over $700 million HKD in illegal cigarettes has been confiscated.
Latest data shows that customs officers have confiscated about 191 million untaxed cigarettes with an estimated value exceeding HKD 706 million during the period when tobacco tax increases became effective. An anonymous source familiar with illegal trade claimed that if these tobacco products were legally imported, they would generate HKD 477 million in tax revenue for the government.
Customs officials seized large quantities of illegal cigarettes in March and April as smuggling gangs continued to bring contraband into the area to replenish stock.
Customs officials recently seized HKD 120 million worth of untaxed cigarettes in the public cargo loading and unloading area in Tuen Mun. The 32 million illegal cigarettes were found in three containers on a ship.
He added that two young men on board the ship were arrested on suspicion of dealing with illicit tobacco. According to the Hong Kong law of Excise Goods, this offense carries a maximum sentence of two years in prison and a fine of one million Hong Kong dollars. Preliminary investigations indicated that the goods in question were intended for local consumption, but the source of the contraband is still under investigation.
The Hong Kong Customs has stated that illegal cigarettes are rarely detected in the morning, with most cases occurring in the evening or at night.
In February, Hong Kong will increase its tobacco tax by 31%, which will raise the average cost of a pack of 20 cigarettes to over HKD 70. This means that an additional HKD 12 will be charged per pack.
According to sources, the price of black market cigarettes has increased by HKD5 per pack, with prices ranging from HKD18 to HKD30 for a pack of 20 cigarettes.
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