Illicit trade in tobacco tops the list, followed by mobile phones and alcoholic beverages, that causes the maximum revenue loss to exchequer in the country, with the illegal market for alcohol and tobacco rapidly growing in Andhra Pradesh and Telangana.
The said States have seen a significant growth in the illicit trade and interestingly, the supply of legal cigarettes shows a decline what with the illegal players taking over the market and together with alcohol, amounting to loss of hundreds of crores to the two governments.
Pan-India, the total loss to government in the year 2014 in respect of seven sectors including Fast-Moving Consumer Goods-FMCG (Packaged) and FMCG (Personal Goods), automobiles, computer hardware, mobile phones, tobacco and alcohol, apart from the media and entertainment industry, including broadcasting and motion pictures sectors, went up from Rs. 26,190 crore in 2012 to Rs. 39,239 crore. The increase in revenue loss to the government grew exponentially by 49.8 per cent and was put at Rs. 13,049 crore between 2011-12 and 2013-14.
These facts were found in a trade report released by the Committee Against Smuggling and Counterfeiting Activities Destroying the Economy of the Federation of Indian Chambers of Commerce and Industry (FICC-CASCADE) by its Advisers P.C. Jha and Deep Chand, who are former Chairman of the Central Board of Excise and Customs and former Special Commissioner of Police, New Delhi and Deputy Inspector-General of Police (Crime Investigation Department), Telangana, Ravi Verma. They expressed concern over the growing scenario and said it was established that profits on such illicit trade, especially tobacco products, was funding terrorism. Mr. Jha said that among factors that were responsible for such an alarming scenario were government policy, strict implementation of laws and deterrent punishment and consumer awareness. Mr. Deep Chand said the need of the hour was tangible actions to increase enforcement and impose increased punishments to reassure legitimate business owners and consumers that the government was serious about the problem.
Mr. Ravi Varma explained that while maximum punishment was just three years imprisonment and a fine of Rs. 2 lakh, he said the fine should be made crores of rupees for it to be a deterrent.
