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Hike of ‘sin taxes’ could boost illicit trade in South Africa, tobacco executive warns

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Hike of 'sin taxes'

Fears have been raised that a planned hike in so-called “sin taxes” on products such as tobacco and alcohol in South Africa could play into the hands of smugglers.

During his budget speech in South Africa’s Parliament last Wednesday, Finance Minister Malusi Gigaba announced that excise duty on alcohol and tobacco will increase by as much as 10% from April, in a move he hopes will raise an additional R1.3-billion ($111.5 million) for the country’s government.

Once the changes come into force, consumers can expect to pay an extra 8.5% in tax on a packet of cigarettes, and anything up to 10% on their alcoholic drink of choice.

Gigaba also added additional excise to “luxury goods” such as cars and mobile phones.

While some analysts suggested the price rise might be the nudge people need to give up unhealthy habits, others cautioned that such proportionality tax high increases in duty on alcohol and tobacco would only serve to fuel the black market.

Commenting on the proposed tax hikes, which are well above the current 4.4% inflation rate in South Africa, British American Tobacco South Africa (BATSA) executive Joe Heshu told Independent Online that a previous rise in sin taxes actually resulted in a decline in the amount of revenue collected by the Treasury.

“Drastically raising taxes on legally-produced cigarettes simply makes illicit products that evade tax even cheaper by comparison, and contributes to the growth of the illegal market”, he said.

“We expect the increase in tobacco excise tax announced by the minister to further stimulate the illicit trade in tobacco, which already results in a loss to the revenue of about R7 billion over the last four years.”

Earlier this month, BATSA revealed that nearly half (47%) of South Africa’s tobacco trade is controlled by illicit players, making it one of the largest markets for smuggled and counterfeit cigarettes in the world.

But while many critics observe that tobacco companies have a vested interest in keeping cigarette prices low and should not be trusted when they push evidence that suggests higher taxes boosts smuggling, evidence in some countries indicates that slapping higher duty on products such as alcohol and tobacco does drive consumers to the black market.

In November last year, the Nikkei Asian Review noted how a 40% rise in the tax paid on a pack of cigarettes had led to a massive increase in the availability of illegal imports.

Similarly, Border force officers in Australia, where the government wants to hike the price of a pack of cigarettes to A$40 (£31) a pack by 2020, seized record amounts of smuggled and counterfeit tobacco products last year.

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Internet watchdog took down record number of child sex abuse images last year

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internet watchdog took down record number of child sex abuse images

The UK-based Internet Watch Foundation (IWF) has revealed that it took down more than 100,000 webpages containing sexual imagery of children and young people aged under 18 last year.

In its latest annual report, the IWF, which works to remove child abuse images from the internet, said it discovered and took down a record 105,047 webpages featuring indecent material last year.

Many of those pages contained hundreds of indecent images and videos, it said.

That figure was up from the 78,589 pages the organisation identified and removed from the internet in 2017.

The IWF said the increase was in part thanks to its use of improved technology to help its analysts speed up the detection and assessment of child abuse material.

Figures for 2018 show that the amount of indecent images hosted in Britain has reached the lowest level ever recorded by the group.

Just 0.04% of the global total dealt with by the IWF last year was hosted in the UK, which was down from 18% in 1996.

In contrast, nearly half (47%) of the illegal content reported to the organisation last year was hosted in the Netherlands.

The IWF said it has offered to provide support to a Dutch organisation that deals with indecent images of children online.

Four-fifths of the child sex abuse images processed by the IWF last year were found to be hosted in European countries.

Over the first six months of last year, the IWF discovered that more than a quarter (27%) of the content it assessed was “self-generated”, and predominantly involved girls aged between 11 and 13 who had been manipulated  into livestreaming images of themselves from their bedrooms or elsewhere in a home setting.

In a statement issued to coincide with the launch of the report, IWF CEO Susie Hargreaves commented: “Despite us removing more and more images than ever before, and despite creating and using some of the world’s leading technology, it’s clear that this problem is far from being solved.

“The cause of the problem is the demand. Unfortunately, and as the police tell us often, there are 100,000 people sitting in the UK right now demanding images of the abuse of children.

“This is a global challenge and no doubt every country’s police force will have their own estimations of this criminality.

“With this continued demand for images of child rape, it’s a constant battle.”

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US authorities could reclassify synthetic opioid fentanyl as ‘weapon of mass destruction’

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US authorities could reclassify synthetic opioid fentanyl

The US Department of Homeland Security (DHS) has suggested that synthetic opioid fentanyl could be reclassified as “a weapon of mass destruction”, according to an internal memo obtained by military news site Task & Purpose.

In the memo, the DHS argues that the toxicity of the drug, which is said to be as many as 100 times more potent than morphine, makes it a suitable candidate to be categorised as a non-conventional chemical weapon, which would allow law enforcement agencies greater power to inspect suspected shipments and develop new tools with which to detect them.

“Fentanyl’s high toxicity and increasing availability are attractive to threat actors seeking non-conventional materials for a chemical weapons attack,” DHS Assistant Secretary for Countering Weapons of Mass Destruction James McDonnell wrote in the memo.

“In July 2018, the FBI Weapons of Mass Destruction Directorate assessed that… fentanyl is very likely a viable option for a chemical weapon attack by extremists or criminals.”

McDonnell notes that human consumption of as little as two milligrams of the synthetic opioid can result in death.

The memo only focuses on quantities of the drug that could be used to create mass-casualty weapons, but fails to outline how much fentanyl would be required to produce such a threat.

Going on to make clear that reclassifying the drugs could help curb its role in America’s spiralling opioid crisis, McDonnell writes: “[M]any activities, such as support to fentanyl interdiction and detection efforts, would tangentially benefit broader DHS and interagency counter-opioid efforts.”

Figures from the Centers for Disease Control and Prevention (CDC) show that US overdose deaths linked to fentanyl rocketed between 2011 and 2016, increasing from fewer than 1,700 to over 18,000 over the five-year period.

Back in October 2017, US President Donald Trump declared the opioid crisis engulfing America a public health emergency, and outlined a series of measures designed to clamp down on the importation of cheap synthetics such as fentanyl from China and parts of Latin America.

Months later, Trump signed a bill designed to tackle the issue into law, providing Customs and Border Protection (CBP) officers with $15 million of extra funding to be spent on new screening devices and lab equipment.

Taking to Twitter, the President wrote: “Together, we are committed to doing everything we can to combat the deadly scourge of drug addiction and overdose in the United States!”

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Dread Pirate Roberts 2.0 jailed for running second iteration of Silk Road dark web marketplace

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Dread Pirate Roberts 2.0 jailed for running second iteration of Silk Road

A jobless university drop-out from the UK city of Liverpool has been jailed after being convicted of running the Silk Road 2.0 dark web marketplace while collecting indecent images of children.

Liverpool Crown Court heard that Thomas White, 24, helped run the original Silk Road marketplace until it was closed down by FBI investigators in 2013.

Within a month of its shutdown, White had launched Silk Road 2.0, which like its predecessor was used by vendors to offer illicit items including drugs, weapons, cyber crime tools and stolen credit card details on the dark web.

White, who abandoned his accounting degree at Liverpool John Moores University after just one term, rented a £1,700 ($2,225)-a-month apartment on the waterfront in Liverpool city centre at the time of his arrest, despite ostensibly being unemployed.

While investigators from the UK’s National Crime Agency (NCA) said they could not be sure how much money White made while operating Silk Road 2.0, it is estimated that illegal goods worth some $96 million were sold on the platform, on which he would take a commission of between 1% and 5%.

During a raid on White’s apartment, police discovered a laptop computer under his bed, which was found to contain 464 indecent images of children in the most serious category.

It later emerged that White had discussed setting up a hidden website on which to publish child abuse material during an online chat with a Silk Road 2.0 administrator.

Like Ross Ulbricht, who was jailed for life with no parole for running the original Silk Road marketplace in 2015, White used the online alias Dread Pirate Roberts, a reference to a fictional character in the novel the Princess Bride by William Goldman.

White was sentenced to more than five years behind bars.

Speaking after he was jailed, Ian Glover from the NCA said: “White was a well-regarded member of the original Silk Road hierarchy.

“He used this to his advantage when the site was closed down.

“We believe he profited significantly from his crimes which will now be subject to a proceeds of crime investigation.”

Separately, one of Britain’s most senior cyber detectives has warned that Europeans gangs are targeting autistic gamers in the hope of turning them into the next generation of hackers.

Peter Goodman, National Police Chiefs’ Council (NPCC) lead for cyber crime, told the Press Association that more than eight out of 10 (82%) of young people being enlisted by online criminals develop skills while gaming, with many of those targeted on the autistic spectrum.

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