BLACK MARKET COSTING ECONOMY UP TO €1.5 BILLION A YEAR - Illicit trade, or black market trading, could be costing the economy up to €1.5 billion a year, according to a study by Grant Thornton and Retail Ireland. They looked at four sectors with which the trade is most associated - fuel, cigarettes, digital and intellectual property and the pharmaceutical sector.
Brendan Foster, a partner with Grant Thornton, said the cost break down was €1 billion in terms of lost revenue to the exchequer and over half a billion in losses to business. He said the illicit trade in pharmaceuticals is a global issue which has a knock on effect here given our reliance on pharmaceuticals. ''Globally as much as 10% of overall medicine consumption is of products that have been traded illicitly. That has a knock on effect on exports, corporation tax and jobs in the economy,' he explained.
Mr Foster said there was generally an upsurge in consumption of illicitly traded products in a downturn. "Illicit trade is encouraged by the gap in terms of the cost of producing items and the cost to the consumer. 78% of the cost of tobacco, for instance, is government tax receipts. There is an opportunity for criminals to create significant profit. In harsh times, consumers are looking to buy products at reduced price. Up to 19% of product consumed in that sector is illicit," he said.
Mr Foster said consumers must understand that illicit trade is not a victimless crime. He called on the Government to come up with a joined up approach across the various sectors and develop a plan to tackle what is a significant economic problem. "In the context of receipts and savings on austerity, this is a significant saving by any measure."
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