44
TOBACCO OUTLET BUSINESS
NOVEMBER/DECEMBER 2012
a Global effort
Global consumption of illicit cigarettes is estimated at 600 billion cigarettes per year and represents the world’s
most trafficked consumer product, according to recent industry data. And the problem is reportedly getting worse.
According to a recent study by KPMG, the annual consumption of illicit cigarettes in the European Union (EU)
increased by 1.1 billion units in 2011 versus 2010, to a record total of 65.3 billion units. KPMG estimates the
associated national and EU revenue loss to be approximately 11.3 billion euros.
But now, INTERPOL (International Criminal Police Organization) has a plan, and not surprisingly, the giant
international tobacco company is a part of it.
In June, Philip Morris International (PMI) contributed 15 million euros to INTERPOL’s global initiative to
combat trans-border crime involving illicit goods, including tobacco products.
“
Counterfeit and contraband cigarettes present a debilitating problem for business and government alike and so
we are delighted to announce our support of INTERPOL’s global efforts to combat illegal trafficking,” says Louis
Camilleri, PMI chairman and CEO.
“
The eradication of illicit cigarettes and the criminality associated with it requires a concerted and coordinated
cross-border effort which INTERPOL is ideally placed to lead,” adds Artyom Chernis, PMI vice president
for Illicit Trade Strategies and Prevention. “We look forward to our cooperation and the positive results we are
confident it will yield.”
PMI’s contribution to INTERPOL’s Fund for a Safer World will be used for coordination of information
gathering, training programs for law enforcement officials, development of product authentication standards and
the execution of public information campaigns.
state Tax rates Help Paint Contraband Picture
State CigaretteTax Rates (Per 20 Stick Pack)
As of July, 2012
It’s easy to see how state cigarette tax disparities facilitate illegal activity: purchasing legally taxed products in
Virginia (a low excise tax state) for approximately $4.50 a pack and transporting them for resale to New York City
(
a high excise tax city in a high excise tax state), where a pack sells for approximately $13, creates an estimated $8.50
per pack profit margin.
SOURCE: ATF (Bureau of Alcohol, Tobacco, Firearms and Explosives) Tobacco Diversion Fact Sheet
Shade of Black
Billion
THE
ME
$2.00
NH
$1.78
VT
$2.24
MA
$2.51
CT
$3.00
RI
$3.46
NY
$4.35
NJ
$4.35
DE
$1.60
PA
$1.60
MD
$2.00
VA
30
¢
NC
45
¢
WV
55
¢
SC
57
¢
GA
37
¢
TN
62
¢
kY
60
¢
AL
42.5
¢
FL
$1.339
MS
68
¢
AR
$1.15
MO
17
¢
IL
98
¢
IN
99.5
¢
MI
$2.00
WI
$2.52
IA
$1.36
MN
$1.578*
ND
44
¢
SD
$1.53
NE
64
¢
kS
79
¢
Ok
$1.03
TX
$1.41
NM
$1.66
CO
84
¢
WY
60
¢
MT
$1.70
ID
57
¢
AZ
$2.00
NV
80
¢
WA
$3.025
OR
$1.18
CA
87
¢
Ak
$2.00
HI*
$3.00
LA
36
¢
OH
$1.25
UT
$1.70
High Tax States
(
$1.51 and over)
Low Tax States
(
$.60 and under)
Medium Tax States
(
$.61 - $1.50)
No Tax Stamp
Continued on page 46