Jim O'Keeffe (Cork South West, Fine Gael)
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Question 101: To ask the Minister for Finance his estimate of the loss to the Exchequer in 2009 arising from cigarette smuggling; and the measures being taken and proposed to deal with this situation. [37616/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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It is not possible, as I have stated in response to a number of Parliamentary Questions over the past year, to provide a reliable estimate of the loss to the Exchequer as a result of cigarette smuggling. This arises from the fact that there is no proven internationally recognised method for determining such an estimate.

The Revenue Commissioners have given a tentative estimate that up to 20% of cigarettes consumed in the State in 2008 were untaxed in this State. However, this estimate included both smuggled cigarettes and also cigarettes legally purchased by cross-border shoppers for personal consumption. While most cross-border purchases involves travellers arriving from Spain, Portugal and certain East European countries where tobacco prices are low, Northern Ireland is also a destination for cigarette purchasers.

I wish to assure the Deputy that both my Department and the Revenue Commissioners, who are responsible for the collection of tobacco products tax and tackling the illicit trade in cigarettes and tobacco products, are concerned at the level of cigarette smuggling. It is generally accepted that the high level of taxation levied on cigarettes in Ireland makes it a target for smugglers despite the comparatively small size of the market.

I am informed by the Revenue Commissioners that their strategy in relation to tobacco smuggling involves a combination of cargo and passenger profiling, intelligence gathering and mutual assistance co-operation with other Customs services. Where appropriate, x-ray scanning technology is used to detect and seize contraband in maritime and air transport. In this regard a second mobile container scanner has been purchased and is due to arrive in Ireland later this month. This scanner is expected to increase the overall level of detection at our major ports.

Revenue and an Garda Siochána also carry out multi-agency operations, particularly in relation to controlled deliveries. Where relevant, these operations involve international law enforcement agencies. The Customs service continuously reviews its strategy which includes analysis of resource requirements and its optimum staff deployment.

Revenue policy also entails close liaison with the legitimate tobacco industry and the Office of Tobacco Control. In addition intelligence driven and random checks are mounted at retail outlets and markets and other distribution centres in order to detect and seize illicit tobacco products which have evaded detection at the point of importation.

Furthermore, the Revenue Commissioners engage with the work of the European Anti Fraud Office which co-ordinates both international operations and other countermeasures undertaken by the authorities of the Member States against cigarette smuggling.

This combined approach has resulted in the seizure of almost 200 million cigarettes to-date in 2009. Included in this amount is the seizure of an estimated 120 million cigarettes at Greenore on 27 October 2009 in the course of the multi-agency Operation Samhna. This is a prime example of the fruits of multi-agency cooperation in the fight against this organised crime. The intelligence and operational strategy is backed up by a robust prosecution policy which has resulted in 101 convictions for cigarette smuggling or dealing in smuggled cigarettes during the first nine months of 2009. A significant number of other cases are already before the Courts awaiting hearing or are being processed for prosecution.