UNMIK/PR/727
SRSG Michael Steiner announced today a regional conference to discuss ways to combat cigarette smuggling that will be held in Pristina on Friday, 10 May.
Ministers of finance and customs directors from Albania, Montenegro, Bosnia-Hercegovina, Croatia, Serbia, Bulgaria, and the former Yugoslav Republic of Macedonia have been invited to discuss solutions to the smuggling which has led to significant loss of public revenues to governments in the region and a consequent reduction of funds available for the provision of public services.
SRSG Michael Steiner has proposed the conference as part of UNMIK’s priority to combat organized crime and corruption and to create conditions for economic growth.
“Cigarette smugglers are stealing from the people of Kosovo, and we are talking big bucks here,” he said today. “It is a problem which can only be dealt comprehensively, at the regional level.”
He added that while Pristina is seen in some quarters as a center for crime and smuggling in the region, “Let’s counter this perception and show that Pristina is where the problem was fixed.”
Participants will discuss practical and coordinated steps to end the region-wide practice of avoiding taxation on the transport and sale of cigarettes.
Of the euro 105 million collected each year in excise taxes in Kosovo, at least 20 million comes from taxes on cigarettes. However customs officials in Kosovo estimate that euro 8 million is eluding customs control every year.
This is an improvement over the past, however, customs officials say, when as many as 30 million euros may have escaped collection during 1999-2000.
Due to improved efforts at tax collection, as well as the reduction in the tax rate on cigarettes coming into Kosovo, the share of excise tax generated by cigarettes has grown dramatically--from 1 percent of excise tax revenues collected in 2000 to more than 13 percent in 2002.
