Calls for coordinated effort to tackle illicit alcohol
Source: The Spirits Business
by Amy Hopkins
11th December, 2015
Spirits Europe has reiterated its calls for a coordinated effort to tackle the counterfeit spirits market as a new report reveals the scale of the problem.
Today the OECD Task Force on Charting Illicit Trade released a preliminary version of its Illicit Trade: Converging Criminal Networks report, analysing some of the largest areas of illicit trade.
The report reveals that the illicit alcohol sector costs billions of pounds in lost tax revenues for governments and private sales for drinks firms, breaking down how the market affects different countries.
Spirits Europe welcomed the report, claiming that it “highlights an important issue to be solved for the benefit of all”.
“Illicit trade in alcohol cuts into our spirits sector, reducing our ability to grow, invest and employ but also cuts into the tax revenues that national exchequers could normally expect to receive,” said Paul Skehan, director general of Spirits Europe.
“We would like to work with national governments, the European Commission and others to more accurately quantify the scale of the problem, and then to address the drivers behind this unwelcome phenomenon.”
Skehan added that the World Health Organisation (WHO) estimates illegal alcohol market accounts for 30% of the international sector.
“However, the level of knowledge remains quite poor,” he said. “We see the OECD report as a great contribution to the debate but more is needed for systematic and comparable research to measure the scale & value of illicit alcohol in Europe”.
Spirits Europe continues to criticise governments for imposing tax hikes on alcohol, which it claims act as a catalyst for the black market.
“Years of austerity has had multiple, interconnected, negative effects on our businesses,” added Skehan.
“Not only has it knocked a hole in the pockets and wallets of our consumers, but it has also left large deficiencies in many exchequers, deficiencies that finance ministers look to make up through increased taxation of our products with the end result of growing illicit markets, the scale of which is directly linked to excessive increases in tax on legitimate products.”
The objective of the OECD taskforce is to facilitate a holistic effort to improve data quality, enhance partnerships between the public and private sectors for data sharing, and conceive effective new strategies.