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NGO: Untaxed cigarettes hurting health, economy

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The CMH said almost one third of all cigarettes sold in the Cambodian market lacked a proper stamp from the Ministry of Economy and Finance’s General Department of Customs and Excise. CMH

NGO: Untaxed cigarettes hurting health, economy

The NGO Cambodia Movement for Health (CMH) is concerned about health problems and economic losses from the loss of tax revenue after the Department of Psychology of the Royal University of Phnom Penh found early this year that 28 per cent of all imported cigarettes were sold in the Cambodian market without the proper stamp from the General Department of Customs and Excise.

In a press release on November 5, the CMH said the untaxed cigarettes included ESSE, Hero, Oris and Gold Seal.

Citing interviews with cigarette sellers, the CMH said untaxed cigarettes were distributed by cigarette companies and bought directly from wholesalers. The sellers said the companies’ agents always distribute cigarettes to them. If no company agent comes to sell to them, they would buy directly at the wholesale depot.

The press release said: “Tobacco use poses a serious risk to people’s health and causes great economic losses every year. About 15,000 Cambodians die from diseases caused by tobacco use and about $656 million is lost.

CMH executive director Mom Kong told The Post on November 5 that Cambodia has the lowest tariffs on tobacco products among ASEAN countries, which he said could lead to serious health and economic disasters.

According to research from the UN Development Programme (UNDP), the Framework Convention on Tobacco Control (FCTC), the World Health Organisation (WHO) and the NGO RIT International, unstamped and untaxed cigarettes contribute to the loss of government tax revenue.

The CMH said if the government effectively prevented tax evasion, Cambodia would receive an additional seven per cent tax revenue on the current tobacco tax.

Ministry of Economy and Finance spokesman Meas Soksensan said there are measures in place to prevent illegal products that evade taxes.

“First, the government has never encouraged the evasion of cigarette taxes, and second, it has never allowed the sale of products without tax stamps. So this is something we continue to fight,” he said.

Yel Daravuth, the tobacco control expert at the WHO’s office in Phnom Penh, said cigarettes without tax stamps were illegal.

“Illegal cigarettes are a major obstacle to tobacco control in Cambodia. Because it not only reduces the state tax revenue but also makes people more vulnerable to diseases caused by smoking due to increasing usage of tobacco,” he said.

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