A review of this year's headlines.

A review by Ian Lancaster, project leader for ISO 22382 tax stamp guidance standard.

The Pakistan Federal Board of Revenue (FBR) has held a pre-bidding conference for granting a five-year licence for what it describes in a public announcement as an ‘IT-based Solution for Electronic Monitoring (Track and Trace System) for Tobacco Products, Sugar, Fertiliser and Cement’.

It may not have been like the in-person seminars we’re all accustomed to, or yearning for, but we were very happy to report that the International Tax Stamp Association (ITSA) webinar for the Latin American region, held on 3 December under the title ‘Illicit Tobacco during Lockdown: Controlling Tobacco in a COVID-19 Context’, drew close to 150 registrants from all over the Spanish-speaking world.

Phew! What a year 2020 was! A year which had a profound, and mostly adverse effect on almost all countries and industry sectors – including those sectors concerned with excise administration and controlling the illicit trade of excise products.

Product authentication and consumer engagement solutions provider YPB Group (which is listed on the Australian Securities Exchange) has signed a master service agreement (MSA) with a new channel partner, Specific Products, in Thailand, in order to access the high-volume tobacco and tax stamp industries in that country, according to reports in various financial media.

New investment in track and trace systems, rising excise taxes and wider commercial applications will drive tax stamp growth in the next five years, according to Reconnaissance International’s new tax stamp report.

In the February issue of Tax Stamp & Traceability News™, we launched a series of articles by Chander S Jeena, on the illicit tobacco trade in Southeast Asia and how it is being dealt with. This month we continue the series with an update on the situation in Cambodia.

AIPIA, the Active & Intelligent Packaging Industry Association, held its conference on Smart Packaging in mid-September – it’s first ‘Virtual Congress’.

The National Office of Vine and Vitivinicultural Products (ONVPV) in Romania is using holographic labelling from security printer Eltronis to promote the provenance of its regional wines and protect consumers from potential counterfeits.

The COVID-19 pandemic is still very much with us and as we head towards the end of 2020, the world remains mired in uncertainty and various degrees of lockdown – albeit with a light at the end of tunnel in the shape of a viable vaccine.

On 3 November, voters in the United States sent a clear message to policy makers and legislators alike. Those in four states – Arizona, Montana, New Jersey, and South Dakota – approved statewide ballot measures to legalise marijuana for personal use. In addition, voters in Mississippi and South Dakota approved statewide ballot measures to legalise marijuana for medical use.

In a recent interview by the European Network for Smoking and Tobacco Prevention (ENSP) with Dr Adriana Blanco Marquizo, Head of the WHO Framework Convention on Tobacco Control (FCTC) Secretariat, Dr Blanco expressed her concerns with the effect of the COVID-19 pandemic on the progression of the FCTC and its Protocol to Eliminate Illicit Trade in Tobacco Products. She further stressed the importance of civil organisations in helping parties to implement FCTC provisions at national, regional and global level.

It has been a decade since Luk Joossens et al published their influential study on the global illicit cigarette market, which examined a sample of 84 countries, and found that 11.6% of the world’s cigarette market was illicit. The study also found that eliminating illicit trade in cigarettes globally would reduce cigarette consumption by 2%, generating at least $31 billion in tax revenues, and preventing millions of deaths.

The COVID-19 pandemic has disrupted the lives, health and financial well-being of many across the globe. Unfortunately, though, it did not disrupt illicit trade, which is not only alive and well but actually thriving as the pandemic rages on. Countless government and news reports show that the pandemic has created ideal conditions for illicit trade to grow and present an ever-increasing threat.

The Department of Revenue and Taxation (DRT) of the US island territory of Guam in the Western Pacific, is opposing proposed legislation that would require it to hire a private company for the enforcement of tobacco taxes, as well as for the administration of a cigarette tax stamp programme that was supposed to be implemented in October 2018, but which is yet to see the light of day.

The Inland Revenue Department (IRD) of Nepal has issued a fresh global tender for excise tax stamps for tobacco, spirits, wine, beer and cider, reports The Kathmandu Post. A tender notice was issued on 14 October and all participants have until 29 November to submit their bids.

In January 2019, Tanzania rolled out the first phase of its ‘Electronic Tax Stamp’ (ETS) programme, on cigarettes, spirits, wine and beer, followed seven months later by domestic and imported flavoured water and carbonated drinks.

One of the largest illegal cigarette factories ever discovered in the Netherlands has been dismantled by law enforcement, with 13 arrests and seizures of 3.6 million cigarettes and 32 tonnes of tobacco.

An extensive lobbying effort by the tobacco industry has been revealed in a paper by researchers at the University of Bath (UK), published in October in Tobacco Control.

In September, the University of Bath’s Tobacco Control Research Group, a key partner in the STOP campaign (Stopping Tobacco Organisations and Products) published a case study and profile on South Africa and the country’s handling of the illicit tobacco trade.

In October, the International Tax Stamp Association (ITSA) wrote to Julio Castilla Peláez, President of the Costa Rican Chamber of Commerce (CCCR), responding to an article in the La Nación newspaper titled ‘Traders reject attempt to revive plan to label and monitor liquor’.

Ashton Potter, a leading provider of high security printing and forensic traceability technology for the private and public sector, and BostonCIO, a professional services information technology consulting firm, have announced a partnership to integrate their ProLinc® and BostonCOMPLY Practical Compliance Automation™ SaaS solutions.

Two recent articles in this publication specifically caught my eye and set in progress the compilation of this article. The first, ITSA Hits Back Over Tax Stamp Criticism, appeared in the June 2020 edition followed by Blockchain and Excise Supply Chains: Hype, Conjecture and Reality, in July.

In the February issue of Tax Stamp & Traceability News™, we launched a series of articles by Chander S Jeena, on the illicit tobacco trade in Southeast Asia and how it is being dealt with. This month we continue the series with an update on the situation in Malaysia.

Cigarettes and tobacco products were the most reported counterfeit goods in the UK in 2019/20, according to a survey conducted by the country’s Intellectual Property Office (IPO) and IP Crime Office.

The West African country of Liberia will this year be introducing tax stamps for the first time. In the second quarter of 2020, the Liberia Revenue Authority (LRA) awarded a contract to Madras Security Printers for tax stamps on tobacco products, spirits, wine, beer and non-alcoholic beverages.

Writing a Request for Proposal (RFP) for a new public sector tax stamp programme, or even to update an existing programme, can be a daunting prospect. Where does one start? What has to go into this RFP? How comprehensive does it need to be, and how does one avoid any hint of corruption in the process?

SGS and Purity-IQ Launch New Service to Authenticate Cannabis Products, Kezzler and Trace Announce Blockchain Partnership, Molecular Tags that are Sprayed onto Cannabis Flowers, Oklahoma Announces New Track and Trace Contract with Metrc.

When it comes to the effective storage and management of data, it should be recognised that security, flexibility, and efficiency are key. Increasingly, governments, businesses, and organisations around the world are exploring cloud-based computing options as a complement – or alternative – to more traditional, on-premises hardware and software solutions. For tax administrators, the ongoing shift presents both opportunities and unique challenges.

The World Customs Organisation (WCO) has released the annual update of its Illicit Trade Report (ITR). Reports were submitted by 86 countries – up significantly from 54 countries in 2018, making it more representative than previous iterations.

At the end of June, the Authentication Solution Providers’ Association (ASPA) and GS1 India joined forces to, as they describe, take the fight against counterfeiting to the next level in India, with the use of global standards.

Domino Printing Sciences, a producer of coding, marking and printing technologies, has acquired Lake Image Systems, a producer of automated, inline, vision-based inspection systems.

In response to the coronavirus outbreak, South Africa introduced two highly contentious prohibitions, banning the sale of both alcohol and tobacco products. The impact has seen both a complete loss of all duties and taxes from these commodities, and a booming illicit trade.

In the July issue of Tax Stamp & Traceability News™ (TSTN), we referred to a news article in The Kathmandu Post, claiming that Perum Peruri, which had been selected in March to supply tobacco and alcohol tax stamps to Nepal’s Inland Revenue Department (IRD), had failed to show up for the signing of the contract for the stamps, and that the IRD had subsequently initiated legal action against the company.

In July, an online webinar held by the International Tax Stamp Association (ITSA) brought together 160 stakeholders from around the world to discuss best practices for implementing a tobacco control and revenue-raising programme, against the backdrop of the WHO FCTC Protocol to Eliminate Illicit Trade in Tobacco Products.

Next month, Reconnaissance International will launch the much-awaited third edition of Tax Stamps & Traceability: A Market Analysis and Technical Update – which, since the launch of the first edition back in 2007, has remained the only authoritative report of its kind.

While South Africa battles with booming illicit tobacco and alcohol trade that, according to its revenue service, ‘may or may not require track and trace’, other countries in Africa are moving swiftly ahead with the introduction of secure marking and track and trace systems before the end of this year.

Reconnaissance International, publisher of Tax Stamp & Traceability News™ (TSTN), is pleased to announce that with effect from September 2020, TSTN will be moving to a new online platform, incorporating a regular newsfeed service alongside the monthly newsletter.

In the February issue of Tax Stamp & Traceability News™, we launched a series of articles by Chander S Jeena, on the illicit tobacco trade in Southeast Asia and how it is being dealt with. This month we continue the series with an update on the situation in Thailand, although this time we are expanding our focus to include products other than tobacco.

The Indonesian company Perum Peruri, which was selected in March to supply tobacco and alcohol tax stamps to Nepal’s Inland Revenue Department (IRD), has failed to show up for the signing of the contract for the stamps, reports The Kathmandu Post. This situation is made all the more strange considering Perum Peruri’s longstanding relationship with the department.

The term ‘biometrics’ is commonly used to describe technologies that employ human features that are unique to individuals – such as fingerprints or retinal eye patterns – as a way to identify those individuals. But the term is also employed, within the authentication industry, to describe technologies which use the intrinsic microscopic or molecular properties unique to items such as tax stamps to identify and thereby authenticate those items. Hence the term ‘document biometrics’, or ‘fingerprinting’.

Blockchain has generated nothing short of hysteria in the technology world. Blockchain made its big public debut in tandem with a new form of currency, the volatile but very real bitcoin, the world's first crypto-currency that many thought would be the end to traditional money.

2020 was supposed to be the year cannabis went mainstream in the United States. As the New Year rang in, cannabis was already legalised for medical use in 33 states and even legalised for adult recreational use in 11 states.

In July, the Philippines government reached a milestone in its fuel marking programme when it surpassed 10 billion litres of fuel marked, according to a BusinessWorld article.

In April, the Moscow Printing Factory of Goznak announced that it had started a pilot project, together with Russia’s Federal Service for Alcohol Market Regulation, for the application of what it called ‘special’ stamps to beer and low-alcohol beverages.

In a few months’ time, the current contract for the fuel marking scheme in Mozambique will reach expiry, but it seems likely that the country will choose to continue the scheme, given the positive impact it has had on tax revenues, reports the pan-African news platform The African Exponent.

In the April edition of Tax Stamp & Traceability News™ (TSTN) we looked at the impact of the global COVID-19 pandemic vis-à-vis the tax stamp industry with a view to anticipating what the implications might be for the industry. This article provides an update of sorts, exploring the same themes in terms of additional data points that may help us to better understand how the industry may be impacted.

In the February issue of Tax Stamp & Traceability News™, we launched a series of articles by Chander S Jeena on the illicit tobacco trade in Southeast Asia and how it is being dealt with. This month we continue the series with an update on Vietnam.

In the year following the US state of Michigan’s introduction of a new tobacco excise tax stamp in 2014, tax revenues increased by $15.7 million – when they had in fact been predicted to decline – and exceeded the forecast for the year by nearly $30 million. Furthermore, it took only one year to recoup the costs of introducing this new stamp. Similarly, in Mozambique, alcohol and tobacco excise tax revenues increased by 85% in the first year after the introduction of a new stamp in 2017.

SICPA has been awarded a new 10-year contract to implement its SICPA Excise Tax System (SETS), which will provide a secure, online platform for the payment, collection, and tracking of Oregon’s alcohol privilege taxes (also known as excise taxes).

The International Tax Stamp Association (ITSA) has responded to criticism of paper-based tax stamps in a new report on the use of blockchain technology for collecting excise duties.

An international trade body is on a mission to recruit new members who can help fight the fraudulent trade of tobacco, alcohol and other products.