Health and wealth priced out by bad advice

IN the past two months alone, nearly Rs. 600 million worth of illicit cigarettes were detected at entry points, highlighting a surge in cigarettes smuggled into the country.

- By Kumar RANAWEERA

According to media and research reports, over one billion foreign cigarettes are believed to reach Sri Lankan shores annually, and this year that number is touted to grow. The resultant loss to the Government is estimated to be over Rs. 100 billion.

Sri Lanka is a hotspot for cigarette smuggling due to its high price point, and according to the World Health Organization, has one of the most expensive cigarettes in per capita earning terms. For instance, when standard legal cigarettes are Rs. 160, a smuggled product could be purchased for just Rs. 100. Additionally, capsulated cigarettes are banned in Sri Lanka. But illegal ‘switch’ cigarettes are available for just Rs. 120. If a 100 million sticks of capsulated cigarettes reach Sri Lankan shores offering a retail margin of Rs. 20, smugglers take home Rs. 10 billion. When returns are so high vis-a-vis low risk, smugglers pay scant regard to regulations.