Michael McGrath (Cork South Central, Fianna Fail)
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I propose to take Questions Nos. 219 and 225 together.

The Government is aware that high prices and taxes may make Ireland an attractive location for the illicit trade of tobacco products and therefore tobacco smuggling remains a high priority area. The illicit trade detracts from legitimate businesses, drains resources from the Exchequer, and undermines our public health strategy.

Each year since 2009, Revenue, in conjunction with the HSE’s National Tobacco Control Office, has commissioned Ipsos MRBI to conduct independent market research among smokers about the source of their cigarettes. The survey is an independent research study into illegal tobacco products behaviour patterns, the purpose of which is to estimate the volume of non-Irish duty paid cigarettes being consumed in Ireland. Since 2013, this cigarette research has been complemented by an additional survey on roll your own tobacco. IPSOS MRBI will present the 2023 survey results to Revenue next month.

The key findings of the 2022 survey are:

• 17% of the cigarette packs held by smokers surveyed were classified as illegal
• 13% of the packs were found to be legal but non-Irish duty paid
• 17% of pouches of roll your own tobacco held by smokers surveyed were classified as illegal
• 10% of the pouches were found to be legal but non-Irish duty paid

Of the 17% of cigarette packs found by the survey to be illegal:

• 88% were classified as contraband (i.e. normal commercial brands of cigarettes bought duty paid or duty-free outside the country and smuggled into Ireland).
• 12% were classified as “illicit whites” (cigarettes manufactured for the sole purpose of being smuggled into and sold illegally in another market)

I am assured that Revenue is committed to targeting the illicit tobacco trade and implements a range of measures to identify and target the smuggling, supply or sale of illicit tobacco products, with a view to disrupting the supply chain, seizing the products and, where possible, prosecuting those involved. Revenue’s strategy involves developing and sharing intelligence on a national, EU and international basis, the use of analytics and detection technologies and ensuring the optimum deployment of resources on a risk-focused basis. Revenue monitors trends in the illicit tobacco trade on an ongoing basis and adjusts its actions and redeploys its resources in response to new developments or methodologies employed by the criminal gangs involved in that trade.

The smuggling of tobacco products has a transnational and cross border dimension and, in addition to Revenue’s ongoing cooperation with An Garda Síochána in this area, I am advised that Revenue also works closely with its counterparts in other jurisdictions including colleagues in Northern Ireland through the Cross Border Joint Agency Task Force (JATF), and international bodies including OLAF (the EU’s anti-fraud agency), Europol and the World Customs Organisation.

I am pleased to say that Revenue has achieved considerable success in tackling the illicit tobacco trade in recent years. In 2023, Revenue had 5,164 seizures of cigarettes valued at €55.7m and 1,673 seizures of tobacco with an estimated value of €7.7m. To the end of February 2024, Revenue had 729 seizures of cigarettes valued at €13.94m and 223 seizures of tobacco valued at €1.86m.

Further successes, highlighting Revenue’s approach to the illicit tobacco trade include the detection and dismantling of an illicit commercial cigarette factory in Dublin in February 2024. This detection was as a result of an intelligence-led operation and follow-up investigations are ongoing nationally and internationally.

Recent successes earlier this month, include the detection and seizure of 6,090kgs of tobacco with an estimated value of over €5 million at Dublin Port and 7.3 million cigarettes with an estimated value of over €6.1 million at Port of Cork. Both seizures represent a potential loss to the Exchequer of €3.7 million and €4.8 million respectively.

Revenue’s high detection rate is attributable to their multi-faceted tobacco strategy, continued cooperation and intelligence sharing with other national and international law enforcement agencies and Revenue’s advanced profiling methods and strategic use of appropriate detection technology and assets.

A breakdown of the number of persons successfully prosecuted for tobacco and/or cigarette smuggling in 2022, 2023 and year to date 2024 are as follows:

Year	Summary Prosecutions	Indictable Prosecutions
2022	20	4
2023	40	7
2024 YTD	6	1

As Revenue is a fully integrated tax and customs administration, I am advised that it is not possible to disaggregate the resources deployed, or funding dedicated, at any given time to combat tobacco smuggling. However, Revenue’s Investigation, Prosecution and Frontier Management Division, which has, inter alia, responsibility for trade facilitation, anti-smuggling and anti-evasion, investigation and prosecution, has approximately 1,096 staff as at 31 January 2024. Resources allocated to such work are adjusted and realigned in response to changes in the level of risk in different sectors. I remain open to consider any proposals from Revenue that will support its work in combatting fraud, illicit trade and smuggling.

Finally, the Government has ensured through the Finance Acts over the years that Revenue has the necessary statutory powers to tackle the illicit tobacco trade. I am satisfied that the current legislative framework provides an effective basis for undertaking and continuing its important work in this area. I am assured that Revenue is very alert to the threat that tobacco smuggling poses to health, to legitimate business interests and to the Exchequer, and commend Revenue and all the relevant State agencies for their work in tackling this form of criminality.

The Programme for Government commits to increasing the excise duty on tobacco to further discourage smoking and this is an important aspect of our public health strategy. In light of the effective work of the Revenue Commissioners in tackling the illicit trade, I have no plans to commission an independent assessment of the extent to which tobacco excise increases in recent years are leading to increased illicit market activity.