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Blackmarket tobacco distorts retail sales figures

Blackmarket tobacco distorts retail sales figures

Anti-smoking organisations claim the rate of tobacco consumption has declined following the introduction on 10 December 2004 of smoking ban in bars and indoor workplaces, claims based wholly upon retail sales figures.

The increasing availability nationwide of illegal black market tobacco is distorting retail sales figures, making it next to impossible to determine if there has been a decline in smoking following the introduction of the smoking ban in bars.

British American Tobacco's decision to shut down its New Zealand operation and relocate to Australia, in part, is attributable to a decline in retail sales.

Industry sources acknowledge that 'chop chop', a term for black market tobacco, has helped contribute to the drop in retail sales.

With governments excise and tax accounting for almost eighty percent of retail price of tobacco, entrepreneurs have been quick to venture into the black market tobacco industry.

Where once there was only a primitive backyard industry producing corse low grade tobacco, we now find sophisticated operations delivering a product comparable in quality with commercially produced tobacco.

What makes 'chop chop' attractive to smokers is the price, less than half than that of legal tobacco.

A WIN Party investigation in Christchurch, Wellington and Auckland revealed that for those ‘in to know’ finding ‘chop chop’ is not a problem.

Smokers claim 'chop chop' is plentiful, is well dried, is finely cut, and they dispel tobacco company warnings of health risks associated with smoking tobacco that hasn't been treated with anti-fungal chemicals to prevent mould.

"The tobacco's that fresh", claimed one smoker, "that as long as you put it in straight in a freezer when you buy it, and only take out enough to last you a day or two at a time, mould don't get a chance to grow".

Another smoker informed WIN the reason for the marked improvement in 'chop chop' quality over the past year or so was due to the influx into New Zealand of people who've been heavily involved with the Australian black market tobacco trade".

"These guys know how to process the stuff properly", he said, "and they know how to build machines that cut the leaf as fine as the stuff you buy in the shops".

"As long as governments reap exorbitant tax from tobacco in the name of good health", says WIN Party spokesperson Dave Clarke, "people will find innovative ways to grow and process black market tobacco".

"Prohibition by 'excessive taxation' has never worked. If a government taxes a product to a level beyond the financial reach of most people, the entrepreneurs will step in with a less expensive, tax free alternative".

"High tobacco taxation guarantees with absolute certainty that New Zealand will always have a thriving black market tobacco industry".


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