Joan Burton (Dublin West, Labour)
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Question 142: To ask the Minister for Finance the number of persons who have been brought to court, convicted, imprisoned and fined for tobacco smuggling in each of the past five years and to date in 2010; the average fine for tobacco smuggling in each of the past five years including 2010; the extent to which the increased fines allowable for tobacco smuggling, as set out in the 2010 Finance Bill, have been utilised; if there has been any increase or decrease in the resources in terms of manpower, financial or other resources, dedicated to tackling tobacco smuggling in 2008, 2009 and 2010; his plans to introduce new measures, legislative or otherwise, to combat tobacco smuggling; and if he will make a statement on the matter. [36567/10]

Joan Burton (Dublin West, Labour)
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Question 148: To ask the Minister for Finance the amount of revenue lost to the Exchequer annually through tobacco smuggling; if there has been any increase or decrease in the resources in terms of manpower, financial or other resources, dedicated to tackling tobacco smuggling in 2008, 2009 and to date in 2010; and if he will make a statement on the matter. [36566/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I propose to take Questions Nos. 142 and 148 together.

I am informed by the Revenue Commissioners, who are responsible for the collection of tobacco products tax, and for tackling the illicit trade in cigarettes and tobacco products, that there is no internationally recognised method for precisely determining the amount of tax lost as a result of the illicit trade in cigarettes. However, on the basis of a 2009 survey carried out independently on behalf of Revenue and the Office of Tobacco Control, Revenue estimates that approximately 20% of cigarettes consumed in the State had not been taxed in this jurisdiction. It is important to emphasise that this estimate includes both illicit cigarettes and legal cross-border purchases brought into the State for personal consumption. Revenue would further tentatively estimate that this figure of 20% comprises 14% illicit product and 6% legal cross-border purchases. Based on an estimate of 14%, the loss of excise duty to the exchequer from illicit cigarette consumption during 2009 would be in the region of €200m.

The strategy of the Revenue Commissioners for tackling this illicit trade is multi-faceted. It includes ongoing analysis of the nature and extent of the problem, developing and sharing intelligence on a national, EU and international basis, ongoing review of operational policies, development of analytics and deployment of detection technologies, optimum deployment of resources at point of importation and internally to intercept the contraband product and to prosecute those involved.

Interception at the point of importation is achieved through a combination of risk analysis, profiling, intelligence, and the screening of cargo, vehicles, baggage and postal packages. Revenue enforcement officers also target this illicit trade at the post-importation level by carrying out intelligence-based operations and random checks at retail outlets, markets and private and commercial premises. Revenue and An Garda Síochána also carry out regular multi-agency operations, particularly in relation to large maritime importations and in checks at inland markets.

In relation to the staff resources available to combat cigarette smuggling, enforcement officers are deployed at all key ports and airports. While staffing levels have generally remained static during the period in question, they are subject to continuous review, and staff numbers deployed at these locations are often augmented by additional staff from other areas when specific operations are organised. Although Revenue's overall staff numbers have been reduced over the past two years in the context of Government policy on civil service numbers, Revenue has ensured that the resources deployed in this work have been maintained.

In terms of detection equipment resources, a second mobile X-ray container scanner, to augment the one first deployed in 2006, was commissioned by Revenue in January 2010 and is now fully operational. Container scanning is one of a number of detection technology applications used to detect contraband. However, its deployment must take into account the principle of free movement of goods within the Community as well as the objective of minimal disruption to legitimate trade. Revenue also uses a tobacco detection dog in addition to the smaller baggage/ parcel scanners which are deployed at all major ports, airports and postal depots. Two new X-ray scanners were also purchased within the last 12 months for use in postal depots.

Revenue's approach in relation to the detection of tobacco-related offences is under continuous review. For example, in July of this year Revenue launched a nationwide tobacco operation, which concentrated additional Revenue resources at ports, airports and at various retail points for the purpose of identifying illicit tobacco products. This resulted in 561 seizures totalling 13.7m cigarettes and 195 kgs tobacco in the course of the two-week period of the operation. Further such intensive operations are planned, to supplement the normal ongoing level of detection and enforcement activities.

The Revenue Commissioners have also established a high level internal group, chaired at Commissioner level to examine the risks related to tobacco excise, and to monitor and optimise performance in relation to detection of counterfeit and contraband tobacco products. This group has promoted a number of initiatives aimed at counteracting the illicit trade in tobacco. These include improved profiling of passengers and freight to identify tobacco smugglers, the recent establishment of a tobacco hotline, coordinating national blitz style operations, evaluation and acquisition of scanning and other detection technologies and learning from best practice internationally.

In relation to legislative measures, Revenue reviews the relevant legislation on an annual basis in the context of the Finance Act requirements and submits proposals to my department as necessary. As regards the provision in the 2010 Finance Act which increased fines relating to tobacco smuggling, I am advised that due to the timeline involved in bringing indictable cases to court stage, it is too early as yet to assess the impact of the new penalties.

The multi-faceted approach that Revenue has adopted has resulted in the seizure of 150m cigarettes and more than 2,400 kgs of tobacco to date this year. The details of the number of persons brought to court, convicted, imprisoned and fined for tobacco smuggling and the average fine for tobacco smuggling in each of the past five years and to date in 2010 are set out in the tables below.

2005

2006

2007

2008

2009

2010 (To 30th September)