Untaxed tobacco products hitting govt revenue

By MARK HAIHUIE
GOVERNMENT revenue is limited with ongoing sales of untaxed tobacco products, according to British American Tobacco PNG.
The company contributed more than K400 million in tax last year.
“This is due to slow enforcement of laws, especially with the legal minimum pack of 25 cigarettes,” BATPNG external affairs manager George Panao said.
“Unfortunately, progress has been slow in this regard, particularly with respect to the enforcement of the Tobacco Control Act 2016 and the minimum pack size of 25.
“There is still tobacco being sold in packs of 20s in the market, when the legal minimum pack size is 25s, as stipulated by Section 24 of the Act.
“There is still tobacco being sold without the packaging clearly stating ‘Intended for Sale in PNG’.”
Panao told The National that cigarettes sold at lower prices were most likely illicit and authorities ought to come down hard on those responsible.
“With the current import duty, excise rates and GST, the total tax payable on a single stick of cigarette is 66t or K16.50 for a pack of 25s,” he said.
“It is clear that tobacco products being sold at anything less than these amounts is illicit and have evaded the rightful tax in some way.
“We urge authorities to look into this and ensure evaders are punished and should start contributing to the Government revenue by paying the right amount of taxes.”
Panao said BATPNG made a significant financial contribution to the country, both directly by excise revenue and other corporate taxes, and indirectly with local investment and employment.
“We contributed over K400 million in excise revenue in 2017 and continue to work constructively with the Government to ensure a stable operating environment,” he said.