The tobacco pirates invade Ireland

posted at 8:41 am on March 21, 2013 by Jazz Shaw

Ireland has had more than its share of fiscal problems over the last decade, having been long considered one of the original “PIGS” nations. (Portugal, Ireland, Greece and Spain) They actually did a good job in a number of areas when it came to reducing the tax burden on employers and attracting new business, working their way up to a somewhat more stable position than the real sinkholes like Greece. But in one area of revenue generation they fell victim to the same temptation as many states in the US… they went for the sin taxes. Cigarettes in Ireland are some of the most expensive in the region now, thanks to the policy, coming in at nearly 10 euros per pack.

So how did that work out for them?

CIGARETTE smuggling continues to soar in Ireland, with new Department of Finance figures showing that tobacco excise tax receipts are falling dramatically short of targets, even though taxes have increased and the number of people smoking has remained constant at 29 per cent of the population…

Criminal gangs are openly selling smuggled cigarettes on the streets of central Dublin and other cities, door to door and at fairs and markets. Counterfeit cigarettes can be brought to the Irish market at a cost of just 20 cents a pack and sold on the black market at €4.50. The average selling price of legitimate cigarettes is €9.20 a pack.

Ireland – at least in this regard – provides a microcosm lab experiment of what’s been going wrong in the United States when taken to its ridiculous conclusion. There is very little enforcement money available to provide the resources needed to stop such activity. (The linked article points out that they only have two mobile X-ray scanners available in the entire state to check tax stamps) And the cops have a lot of serious crime to deal with rather than chasing problems like this. Hence, pirates are actively going door to door in broad daylight filling the orders of those eager to save 50% or more on their purchases.

We’ve covered it here before. It happens in Chicago. It happens in New York. And in all the states that border them. Social engineering results in less tax revenue, not more, and simply drives more otherwise honest citizens and small business people onto the government’s lists of “bad people.” Meanwhile, real problems of fiscal insolvency go unattended. I’m not hoping that Washington or our tax grabbing states will learn from the lesson of Ireland, but they could if you let them know.


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Why would people change their behavior only because it was in their best interest? That doesn’t make sense.

We need a law making free will taxable. We could call it “taxable will” henceforth.

Wino on March 21, 2013 at 8:45 AM

There is very little enforcement money available to provide the resources needed to stop such activity

Damn those Republicans and their sequestration!!! /

Happy Nomad on March 21, 2013 at 8:49 AM

If a tax existed on liberals, which 20-25% of Americans claim to be, there would be no openly-declared liberals within 24 hours. The same goes for cigarettes or anything else nanny-staters feel need to levy at punishing rates.

Liam on March 21, 2013 at 8:51 AM

The worst part, not mentioned here, is who does the smuggling. Ireland’s black market is essentially organized to finance what remains of the IRA. After 1996, when most of the fighting ended, many of the hardened criminals needed something new to devote their lives to. They shifted their massive political/military organization from terrorism to organized crime – essentially becoming the country’s version of the mafia.

Despite the shift, though, they still have old intentions in mind. With the recent economic struggles these former terror organizations have been able to stir up discontent amongst unemployed young people. They’ve brought them into their ranks, and have basically allowed for tensions to remain in place for decades to come via a whole new generation. This doesn’t just happen on the nationalist side either. Groups like the Ulster Volunteer Force have done just as much recruiting on the loyalist side.

There black markets will soon fund more violence. Dissident groups have left the British with a number of near misses in the past couple of years (faulty bombs, etc). One of these days it won’t be a near miss. They’ve also managed to stir up the public with gangs motivated by social policy. Northern Ireland is one of the worst places to be a dealer that isn’t part of the black market. Any one who does sketch business without running it through the IRA is bound to get their knee caps shot in.

That the government encourages such behavior via taxes is sad.

eski502 on March 21, 2013 at 8:53 AM

Why would people change their behavior only because it was in their best interest? That doesn’t make sense.

Wino on March 21, 2013 at 8:45 AM

What makes you think this is about changing behaviors? This solely about raising revenue. In fact, the state doesn’t want people to change their behaviors. Any claims otherwise are as much of a farce as the idea that all that money from tobacco settlement went to healthcare or that the various lotteries really provide much-needed funding to schools.

Happy Nomad on March 21, 2013 at 8:54 AM

pogue ma thoin, ye bastards!

Little Boomer on March 21, 2013 at 8:55 AM

If a tax existed on liberals, which 20-25% of Americans claim to be, there would be no openly-declared liberals within 24 hours.

Liam on March 21, 2013 at 8:51 AM

Let me be the first to go on record supporting this idea. If we could save just one child from liberalism then it is worth it. But I think a 20-25% stupid tax is far too low. Make them squeal like pigs by telling them that their fair share is in the neighborhood of 56% to closer match what the top earners pay in income taxes.

Happy Nomad on March 21, 2013 at 8:57 AM

…….and would be willing to be that some of the same people/groups/companies that own politicians also are profiting from the now “black market” (and the politicians are getting some of the goody on it too).

So very crooked and dirty.

No wonder people tune out political stuff and would rather hear about Beyonce and Jay Leno and Beiber’s breakdowns.

PappyD61 on March 21, 2013 at 9:02 AM

Finance figures showing that tobacco excise tax receipts are falling dramatically short of targets, even though taxes have increased and the number of people smoking has remained constant at 29 per cent of the population…

A similar scheme was tried in Canada around 10 years ago.

Extremely high taxes on cigarettes = massive smuggling and a robust black market = lower tax receipts.

It got so bad they finally rescinded the tax increase on cigarettes there.

I don’t know why governments simply won’t look around the world and see how idiotic policies have worked elsewhere before implementing them at home.

BacaDog on March 21, 2013 at 9:02 AM

Any claims otherwise are as much of a farce as the idea that all that money from tobacco settlement went to healthcare or that the various lotteries really provide much-needed funding to schools.

Happy Nomad on March 21, 2013 at 8:54 AM

Totally true. States were borrowing years ahead on the money slated to come from the tobacco industry over the twenty-year period of the settlement.

Here in NY, I pay $7.63 for a pack of my brand. The tax is $4.35. Plus, there is sales tax at 8.2%. The sales tax is for the total amount, not the $3.28 actual cost of the product itself. In short, I’m paying sales on the tobacco tax, too, for an additional 62 cents or so.

It’s all about the money, and then restricting the activity on top of it. People can’t smoke in bars, restaurants, or even a football stadium. Some are trying to make it illegal to smoke a person’s own apartment or in a car with a child present who is under six. But that’s another story. It’s all about the money first.

Liam on March 21, 2013 at 9:03 AM

Let me be the first to go on record supporting this idea. If we could save just one child from liberalism then it is worth it. But I think a 20-25% stupid tax is far too low. Make them squeal like pigs by telling them that their fair share is in the neighborhood of 56% to closer match what the top earners pay in income taxes.

Happy Nomad on March 21, 2013 at 8:57 AM

LOL Can you imagine if schools, because of my imaginary tax on liberals, had to hire black-market teachers?

Liam on March 21, 2013 at 9:04 AM

I’m not hoping that Washington or our tax grabbing states will learn from the lesson of Ireland, but they could if you let them know.

They know – they don’t care. Typically the smugglers have paid off the right people.

redguy on March 21, 2013 at 9:14 AM

It’s all about the money, and then restricting the activity on top of it.

Liam on March 21, 2013 at 9:03 AM

Worst of all, IMO, are the speed cameras installed for “public safety” (yeah right). DC got millions in fines and don’t think that the revenue isn’t part of their operating budget. And it isn’t even the government enforcing the law- it is a private company contracted to essentially issue speeding tickets.

So, as a result of this wildly successful foray into public safety, the city intends to install even more speed cameras. But of course, it’s all about safety and not raising revenue. I’d have more respect for these pirates if they were at least honest that this is all about fleecing suburbanites and tourists who otherwise don’t have to pay for all the worthless parasites who live in DC proper.

Happy Nomad on March 21, 2013 at 9:16 AM

So, do you think the same thing would happen with guns?

/blink blink

roy_batty on March 21, 2013 at 9:19 AM

I don’t know why governments simply won’t look around the world and see how idiotic policies have worked elsewhere before implementing them at home.

BacaDog on March 21, 2013 at 9:02 AM

Because “We will do it right!”

GWB on March 21, 2013 at 9:39 AM

Why would people change their behavior only because it was in their best interest? That doesn’t make sense.

Wino on March 21, 2013 at 8:45 AM

What makes you think this is about changing behaviors? This solely about raising revenue….”

Happy Nomad on March 21, 2013 at 8:54 AM

This is not about changing behavior or raising revenue. It is about ideology. Not necessarily always knowingly about ideology but, nevertheless, it’s about ideology and, unfortunately, the ideology that brings about statism.

The state raises taxes, always in the name of helping some group or some ‘cause. It happens this way too consistently, too reliably and with too much popularity to be contrived or a pre-meditated scam. Most people (leaders included) really believe this Robin-Hood garbage. The other telling similarity between advocates of these policies is that if you quiz them on the “why” they like those policies and/or consider them useful, you will ultimately hear them provide the conclusion as some variation of ‘because people are rotten” or “original sin” or “can’t be trusted”.

How is this possible, you ask? Don’t they see the contradiction of their premise and their policy choices? No. Because everytime they implement laws that expropriate property in the name of their cause de-joire (i.e. the sin tax), some variation of the situation like a black market/org crime (see eski502 on March 21, 2013 at 8:53 AM) or tax evasion (etc.) occurs which, to them, validates the premise that people are rotten and can’t be trusted to do the right thing. Hence the effort to impose even more regs on society until the most consistent of the bunch gets elected to a position with the most power and opportunity to bring that false premise to its ultimate political conclusion- a statist government of some kind.

It’s about ideology. Most don’t see the logical conclusion of their actions. Making it even more frustrating for those of us who do.

beselfish on March 21, 2013 at 9:46 AM

Send a few pirates to the gallows and see what happens.

I’m all for making cigarette smokers pay their way out of the damage they do to themselves and to others in this welfare society. My mother was a three pack a day smoker (yup — 60 of them a day) — she died from that, having started smoking when she was thirteen years old, an addictive habit she could not shake even when she started needing oxygen to get around.

Care to guess who paid for her medical treatments? In fact, care to guess who paid for her cigarettes — tax and all?

We were very far from rich. You did.

unclesmrgol on March 21, 2013 at 10:28 AM

The answer is obvious to liberals, RAISE THOSE TAXES AGAIN!

GarandFan on March 21, 2013 at 11:06 AM

War on Tobacco. Gotta love it.
But in Ireland- its not just tobacco. The traditional “black market” has expanded from the usual counterfeits,shoes, jewelry, cosmetics to pain killers, Cholesterol meds, antibiotics, fuels, guns, household cleaners and probably anything that has been taxed or banned – is for sale. And sometimes by a door to door sales approach. And yes- it is a net tax loss for the government – while they are forced to spend a lot more for enforcement.

But here is the real insidious part.
Regular, honest, hard working people are turning to this “criminal” activity more and more to stretch their dollars. And as this activity grows, more people, naturally, will get involved with the selling side of this new economy. People I know there regard this as necessary and acceptable- and not criminal.

So what basically is going to happen is you have Big Government taxing, creating and perpetuating a new “criminal” economy. Their policies unltimately will tempt honest people to engage in this otherwise- outside of the law – economy creating a new group of “criminal”.
Would we law abiding Americans buy guns “illegally” if they happened to be banned by our government here?
You Betcha.

FlaMurph on March 21, 2013 at 12:00 PM

I’m all for making cigarette smokers pay their way out of the damage they do to themselves and to others in this welfare society.

unclesmrgol on March 21, 2013 at 10:28 AM

I have always paid for my own health insurance. My smoking is none of your damn business so stop acting as if you should have any say in my decision to smoke. You don’t. I also paid for tons of other people’s insurance through the criminal taxes that dipsh!ts like you support on my cigarettes. Of course, I put an end to that with MYO cigarettes for the past few years.

You can take a flying leap. You people disgust me. Holier-than-thou azzholes who have nothing better to do than mess around in others’ lives.

ThePrimordialOrderedPair on March 21, 2013 at 12:18 PM

When do they ban the – All you can eat buffets – ?

FlaMurph on March 21, 2013 at 12:24 PM

“Send a few pirates to the gallows and see what happens.

I’m all for making cigarette smokers pay their way out of the damage they do to themselves and to others in this welfare society. My mother was a three pack a day smoker (yup — 60 of them a day) — she died from that, having started smoking when she was thirteen years old, an addictive habit she could not shake even when she started needing oxygen to get around.

Care to guess who paid for her medical treatments? In fact, care to guess who paid for her cigarettes — tax and all?”

Any medical treatment spent on smokers is more than offset by taxes, Social Security payments not made and not having to pay for broken hips and Alzheimer care down the road. Best thing we could do to save the country’s finances is to give every graduating High School student a carton of Lucky’s.

Tekov Yahoser on March 21, 2013 at 12:44 PM

I’m all set to start smuggling army-ant marching powder.

Iblis on March 21, 2013 at 1:15 PM

“Send a few pirates to the gallows and see what happens.

The only nation that deals with pirates as they should is China, as evidenced by its reaction to the little monkeys who tried to hijack one of their ships. Western nations don’t even send serial murderers to hang, we’re so utterly spineless.

I’m all for making cigarette smokers pay their way out of the damage they do to themselves and to others in this welfare society.

Tekov Yahoser on March 21, 2013 at 12:44 PM

Yeah the welfare state really puts a crimp on choices.

MelonCollie on March 21, 2013 at 11:02 PM