Cigarette tax of R7bn lost a year

South Africa has become one of the biggest markets for illicit cigarette sales and is losing about R7 billion a year from related tax evasion, a report by the Tobacco Institute has revealed.

Domestic manufacturers are increasing production and they then sell via spaza shops, the institute’s Francois van der Merwe said. “Taxes of at least R17.85 are due on every pack. But smokers can get packs at R5 for 20, which shows taxes are not being paid.”

More than 75% of the cut-price cigarettes are made by Gold Leaf Tobacco. Its RG brand sells at an average of R10.50 a pack, said Van der Merwe.

Gold Leaf’s attorney, Raees Saint, responded: “Most, if not all, of the allegations concerning our client, which our client’s competitor has spread, are false.” – Bloomberg

Moneyweb

The Competition Commission’s Health Market Inquiry (HMI), which probed the dynamics in the private healthcare market to determine whether there are barriers to competition and patient access, has blamed medical schemes and hospital groups for driving up costs and distorting competition.

The HMI has recommended wholesale changes to ways that medical scheme options are structured to increase comparability between schemes and transparency on value-for-money for patients.

During submissions from the public and private healthcare professionals since the inquiry started in August 2014, the panel, led by Judge Sandile Ngcobo, heard that patients were not informed by medical schemes about the