Coalition targets illegal tobacco trade as a way to fight contraband

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Arizona’s border with Mexico makes it a premier smuggling route for illegal goods, including cigarettes, which cost the state more than $ 140 million in tax revenue each year. (File photo by Roman Knertser / News21)

PHOENIX – A truck crosses the US-Mexico border in Arizona. Using a combination of smuggling tunnels, back roads, and well-placed bribes, the driver escapes border patrol and soon arrives in Phoenix with his illicit cargo: $ 4 million worth of untaxed cigarettes.

According to a 2016 study by the Mackinac Center for Public Policy, about 36% of all cigarettes consumed in Arizona are smuggled into the state, which translates into a loss of $ 170 million in tax revenue – and hundreds of dollars. millions of dollars in profits for traffickers. Tobacco is the currency of organized crime around the world, experts say.

“On an 18-wheeled semi-trailer, it costs about $ 100,000 for all of the product in it,” said Kristin Reif, director of illicit trade prevention at Philip Morris International, speaking to the chefs on Wednesday. Arizona Company. “Think about the ROI of that. It only costs $ 100,000 and you can earn $ 4 million. If they have 40 containers, they can lose 39 and still make a profit.

Arizona is one of the worst states for smuggling illegal goods, with California, Texas, Florida and eight others being targeted by a new national initiative from Phillip Morris – United to Safeguard America From Illegal Trade.

Reif met with members of the Arizona Chamber of Commerce, a partner in the initiative, on Wednesday. The partners plan to submit policy proposals on illegal trafficking to the state legislature in December. The meeting also attracted law enforcement, judges, other business leaders and smuggling experts.

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For Philip Morris, the problem is competition and loss of income. But the larger group is also focusing on tobacco, rather than fentanyl or human trafficking, as the illegal cigarette market is a major profit generator for organized crime.

“Whatever you have, tobacco is currency,” said David Lake, founder of the Center on Shadow Economics in Phoenix and expert on illegal trade. “With the criminals, the underworld, I can buy anything with enough cigarettes. I would call someone and say, ‘I need a bunch of tobacco, we buy humans.’ “

Tobacco is just a small piece of a sprawling underground economy that funds drug cartels, terrorist organizations and human traffickers.

“It’s not just tobacco, it’s all. said the lake. “Do you want to be rich in five years?” Learn how to smuggle stamps. They are not optional, and like everything that people need, they make a lot of money.

For Arizona in particular, contraband has been a perennial problem. With the increase in traffic at the border, this problem is only getting worse.

“I don’t have the exact figures for last year at hand, but we had difficulties, obviously, because we are overwhelmed at the border just by the volume of traffic, whatever that traffic is,” he said. said Michael Bailey, a former US attorney for Arizona.

The campaign is in its early stages, but it will likely focus on zero tolerance policies, controls on cigarette ingredients and forfeiture of assets, among other proposals.

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