Legitimate retailers ‘hit hard by crooks and new nicotine laws’
THE Scottish Grocers’ Federation (SGF) has urged First Minister John Swinney to follow Westminster plans to close down stores selling illicit products for up to a year in England and Wales.
Home Secretary Shabana Mahmood announced the proposal last month, saying doubling the time a shop was shut would give investigators more time to pursue prosecutions, while preventing rogue operators from simply reopening and resuming illegal activity.
Chief exec Pete Cheema revealed the trade body had written to Swinney during debates about the criminal trade and the Tobacco & Vapes Act at the SGF Mini Summit in Falkirk last month.
Cheema also said that the SGF wanted to see an illicit trade taskforce created so that there were sufficient resources to enforce the law. He said: “The illicit trade is not victimless, it affects staff safety, store viability, public health and legitimate businesses doing the right thing.
“And unless enforcement matches ambition, policy risks creating exactly the black market it’s trying to eliminate. At the same time, we have major changes coming in vapes, including new duties and tighter regulation.
“The principle is simple: if compliant retail becomes more expensive and complex, then illicit trade fills the gap. That’s bad for retailers, communities and public health. Debating the illicit trade, tobacco and vapes without retailers in the room is like discussing swimming safety without first asking lifeguards.”
Michael McDougall, managing associate at TLT LLP, told how illicit trade distorted the market through unsafe products and underage sales, which had a financial impact on legitimate businesses.
He said about £1.8billion UK tax revenue was lost annually through illegal tobacco.
McDougall highlighted the challenges Trading Standards faced, with a 50% decrease in staff since 2002 and 22 out of 32 Scottish local authorities having eight or fewer officers. He argued extra resources were needed so enforcement could be targeted to support legitimate businesses.
Chris Bell, chairman of the Society of Chief Officers of Trading Standards in Scotland, called on retailers to report problems and press politicians for more resources to tackle illicit operators.
He said Trading Standards needed a system in place to ensure officers were in the right places, could continue to share intelligence and highlight the impact of rogue traders at local authority level.
Brian Boyle, Scotmid chief operating officer retail, said the illicit trade was having a huge impact on sales, saying it was easy to source illegal products, the penalties were not strong enough and there was a lack of enforcement.
He felt the Government didn’t understand the scale of the problem and underestimated its societal impact, revealing how a tip-off from a customer led to the discovery of nine illicit shops in Edinburgh.
Eve Peters, government affairs director at Elfbar, said: “Consumers buying illegal products need to understand that they’re funding organised and immigration crime, as well as unsafe products.”
She said regulation needed to be proportionate so that it didn’t lead to an increase in the illicit trade and urged retailers to protect themselves by choosing trusted brands and checking QR codes.
Peters had earlier said the Tobacco & Vapes Act would result in significant changes to the nicotine category in the next few years.
Day-Today Glasgow retailer Mohammed Rajak thought the new vape liquid duty of £2.20 per 10ml would push customers to illegal products.
He also feared the generational tobacco ban would be hard to implement, create confrontation in stores over proof of age ID and see a rise in consumers turning to rogue traders.
Rajak was concerned about the possibility of vapes having to be hidden from view, saying it would make it harder for shoppers to choose products.
Chris Gallacher, managing director at United Wholesale Scotland (UWS), said gantries would need to be future-proofed and retailers would need to simplify ranges, with pouches playing a big part.
He told how UWS was also looking at technology to stop chaos at the tills over age verification and warned that those affected by the generational ban would go elsewhere to buy cigarettes.
