ASH welcomes new anti-illicit tobacco strategy launched by Government

ASH welcomed the Government’s refreshed anti-illicit tobacco strategy launched today. The new strategy had been pre-announced in the Budget, which noted that it would not only protect public finances but also “help meet public health objectives by driving down smoking prevalence.”

ASH acknowledges the work done to reduce tobacco smuggling and welcomes the commitment to setting up a cross ministerial group on smuggling, and the pledge to support EU ratification of the World Health Organisation’s Illicit Trade Protocol. ASH also welcomes the Government’s intention to work with partners including health organisations such as Public Health England and ASH.

However, ASH is concerned about the use of an industry authentication system, Codentify, to tackle the illicit market given the tobacco industry’s ongoing record of complicity in the illicit market. Most recently, in November 2014, British American Tobacco (BAT) was fined £650,000 for not complying with its legal obligations to control its supply chain after a Public Accounts Committee report which criticised HMRC for not taking tougher action on industry misconduct. Codentify has also been criticised in a report for the WHO, which concluded that it was not compliant with the Illicit Trade Protocol requirement that ‘the tracking and tracing system has to be “controlled by the Party” (i.e. the relevant state or states)’.

ASH welcomes the review of sanctions for involvement in the illicit trade, including naming and shaming, which in the past HMRC has inexplicably refused to use against the tobacco manufacturers. For example, when BAT was fined by HMRC this information was released through the media and not through HMRC, which had insisted that it should be kept confidential.

Deborah Arnott, Chief Executive of health charity ASH said:

The Public Accounts Committee report on tobacco smuggling was very clear. The tobacco industry has continued to facilitate tobacco smuggling and HMRC has failed to challenge the manufacturers properly for their misdeeds. Although there are welcome new actions in the updated strategy, it is still not clear that HMRC has taken this crucial point fully on board. HMRC still seems far too willing to work collaboratively with the industry, rather than treating them as potential tax avoiders. HMRC’s apparent willingness to co-operate with the industry’s Codentify scheme threatens to make the industry far too influential in future action on illicit trade.