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Thupeyo Muleya, Beitbridge Bureau

South Africa’s tax watchdog, TAX Justice SA (TJSA) has welcomed the ruling by the North Gauteng High Court against tobacco companies who were challenging the mandatory installation of Close Circuit Televisions (CCTVs) at their warehouse as the fight against cigarette smuggling between the neighbouring country and Zimbabwe continues.

Selected companies hit a brick wall recently in their challenge against the South African Revenue Services (SARS) intention to install CCTVs at their warehouses.

Ideally, these closed-circuit televisions, which are also known as video surveillance, use video cameras to transmit a signal to a specific place, on a limited set of monitors.

South Africa has become one of the major destinations and conduits where cigarettes are smuggled through Beitbridge Border Post or illegal crossing points along the Limpopo River.

About 30 percent of cigarettes in South Africa are from Zimbabwe and include brands like Pacific, Remington gold, Mega, Dullahs, Branson, and Servilles.

“The Tax Justice SA welcomes a vital legal breakthrough against the illicit tobacco barons who are stealing billions of rand from South Africa and is today urging authorities to now enforce the law to prevent this industrial-scale looting,” said TJSA founder, Mr Yusuf Abramjee.

“Several cigarette manufacturers have failed in their urgent bid to interdict the SA Revenue Service (SARS) against installing CCTV cameras at their warehouses. Now these companies should have to heed laws enabling SARS to monitor the true volume of cigarettes being produced.

“This is a vital breakthrough against the illicit tobacco barons who are robbing South Africa and an estimated R27 billion a year by flooding the market with tax-evading cigarettes”.

He said syndicates have been able to flout the laws and hide their industrial-scale looting from SARS.

Mr Abramjee said now authorities must ensure regulations are properly enforced.

He said the legal challenge against the CCTV rules has been led by the Fair-Trade Independent Tobacco Association (FITA), which represents the local makers of cigarette brands.

Eleven tobacco companies had made two separate applications to prevent SARS from implementing “Rule 19.09” promulgated under the Customs and Excise Act.

The law as set out in the Act, registered licensees who manufacture or store tobacco products should allow SARS to install CCTV monitoring equipment at licensed customs and excise warehouses they operate.

South Africa’s tax watchdog, Tax Justice SA (TJSA) has since accused cigarette manufacturers in the neighbouring country of paying lip service to tax laws following the surge in tobacco smuggling.

The demand for Zimbabwe’s tobacco and related products by other countries has seen the establishment of well-orchestrated syndicates that facilitate the illegal trade and smuggling of the gold leaf into various countries.

It is also difficult for Zimbabweans to export cigarettes to South Africa because of the high excise duty rates in that country (on tobacco or cigarettes).

Cigarettes into the neighbouring country are imported from Zimbabwe at a rate of R6.21 per 10 cigarettes.  — @tupeyo