Tommy Broughan (Dublin North East, Labour)
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Question 42: To ask the Minister for Finance if it is accurate that up to 24% of all tobacco consumed here in 2010 evaded Irish excise duty; if he will provide an estimate for the loss of revenue for this product in 2010; and if he will make a statement on the matter. [10131/11]

Michael Noonan (Limerick City, Fine Gael)
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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 a survey commissioned by Revenue and the Office of Tobacco Control in 2009 estimated that 20% of cigarettes consumed in the State had not been taxed in this jurisdiction. The 20% figure was further broken down as 14% illicit product and 6% legally imported by passengers arriving into the State from other jurisdictions. Revenue and the Office of Tobacco Control commissioned a similar survey in the last quarter of 2010 and the preliminary results of this latest survey show a consistency with the 2009 figures i.e. 20% of all cigarettes consumed in the State were not taxed in the State with 14% again classified as illegal product and 6% classified as legal "non-Irish duty paid" product. Based on an estimate of 14%, the loss of excise duty to the exchequer from illicit cigarette consumption during 2010 would be in the region of €200m .

While these findings indicate that the level of consumption of illicit product is being contained, Revenue is determined to confront the illegal trade in tobacco products and to optimise levels of seizures of illicit tobacco product. Revenue's strategy 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, an ongoing review of operational policies, development of analytics and deployment of detection technologies, optimum deployment of resources at point of importation and to intercept internally the contraband product and prosecute those involved.

Revenue enforcement officers are deployed at all key ports and airports. Personnel deployed at these locations are regularly supported by additional staff from other areas when specific operations are taking place. 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 post-importation level by carrying out intelligence-based operations as well as 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 conducting checks at inland markets.

The Revenue Commissioners have established a high level internal group, chaired at Commissioner level, to examine the risks related to tobacco products tax and to oversee and optimise the 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, national blitz-style operations and the establishment of a confidential tobacco hotline through which members of the public and the retail trade may report illicit trade.

In July of last 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 13.7 million cigarettes and 195 kgs tobacco in the course of the two-week period of the operation. Two subsequent 3-day operations during 2010 resulted in the seizure of over 1.76 million cigarettes and 175 kgs of tobacco. In two similar operations carried out in 2011, a total of 580 seizures were made, comprising 7.4 million cigarettes and 167 kgs tobacco.

In terms of detection equipment, 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. Smaller baggage/ parcel scanners are deployed at all major ports, airports and postal depots. In addition to the X-ray equipment, Revenue also uses a tobacco detection dog.

This strategy has resulted in the seizure of a total of 178.3 million cigarettes with a retail value of approximately €75.3 million and 3,369 kgs of tobacco with a retail value of approximately €1.2 million during the period January to December 2010.

In addition, during the period January to April 2011, a total of 35 million cigarettes and 938 kgs of tobacco were seized by Revenue.