Tobacco distributors warn that the State misses out on collecting $6M in taxes

Tobacco distributors warn that the State misses out on collecting $6M in taxes

Official distribution representatives of the sector in Uruguay assure that 30% of the market is through smuggling.

Photo: Freepik

The official distributors of tobacco in it Uruguay They warn that the State is losing a total of 6,000 million pesos in revenue due to the increase in the smuggling market for this product, and they also denounce a drop in sales due to the same phenomenon.

From the Association of Tobacco and Cigarette Distributors expressed their deep concern about the sale of illegal cigarettes and those derived from tobacco in the country.

Through a statement published within the framework of the World Smoke Free Tobacco Day, They pointed out that the consumption of freeshop, contraband or low-cost brand cigarettes represents 28.6% of the market, while in 2008 it was 17%, according to a survey conducted by Factum.

According to the association’s calculations, this represents a total of 49 million illegal boxes. In turn, they point out that the average daily consumption of smokers is 25% higher with illegal cigarettes than those consumers who buy legal ones.

“We are the official distributors of legal companies in Uruguay and we find that everything results in our sales going down,” said Gustavo Márquez, president of the Association of Tobacco and Cigarette Distributors, to Channel 5.

A loss for the government

On the other hand, the association emphasizes that not only the sector but also the government loses because the taxes due are not paid.

The losses have to do with the lack of Value Added Tax (VAT) and the Specific Internal Tax (Imesi) and that would amount to a total of 6,000 million pesos that are not collected by the government, that is, about 154 million dollars.

In that sense, the sector demands “greater State control of illegal products (contraband or counterfeit) that enter the country and are sold in established businesses or at neighborhood fairs.”

Source: Ambito

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