Illicit trade has to do with smuggling, counterfeiting and tax evasion, human and wildlife trafficking. It causes progress to dwell on the dark side, adds to the overall costs and stops the growth of the goals. Just read below to know more about the topic and find a trustworthy payments specialist that can help you avoid online payment processing fraud to the best possible way.
Illicit Trade: A Growing Problem
This a serious and growing threat that does the opposite of what’s meant by the United Nation’s (UN) Sustainable Development Goals (SDGs). It causes a number of severe threats to society.
Specifically, governments and legitimate businesses often suffer from smuggling, counterfeit and tax evasion. Namely, lost tax revenues account for billions of dollars for governments, and legal businesses are being undermined. Besides, products that haven’t been made properly and don’t fall under any regulations create problems for consumers.
By the way, cigarettes are one of the most illegally trafficked goods all around the globe. In the E.U. (European Union) alone, illicit whites’ share of the overall illicit tobacco trade made up 4.3% in 2007 and reached 33.9% in 2016, as the KPMG SUN Report shows.
The so-called “illicit or cheap whites” represents a new type of illegal tobacco products. This is a growing problem in more than one country. The E.U. Commission defines these products as brands manufactured without violating any laws in the given market.
Then, they’re either charged taxes for local consumption or charged zero taxes for export, and sold knowingly to sellers who transport them to other countries where these products are sold through the violation of laws and without paying any domestic duty.
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To find out more about how these products cause huge tax revenue losses for governments and result in security risks, let’s move forward.
Threats of Trading Illicitly
Those who trade in counterfeit goods pose dangers to consumers and causes harm to public health. This is a threat bringing an end to the lives of endangered species and causing devastating damage to ecosystems.
Let’s take people’s trafficking: it’s widespread in a number of sectors vulnerable to such threat, including fisheries, agriculture, manufacturing, and mining. According to the U.S. Department of Labor, 139 goods from 75 countries are produced by forced and child labor: this refers to anything from diamonds, cotton to garments and electronics.
As for the theft of oil and fuel, together with a variety of fuel fraud types are widespread in the growing forms of illicit trade. They’re directly linked to organized crime and terrorist groups.
Today, it’s critically important that governments and international organizations, as well as the private sector, invest in eliminating the problem. The Transnational Alliance to Combat Illicit Trade (TRACIT) and the United Nations Conference on Trade and Development (UNCTAD) have shown how the mentioned threat can serve as suppression of the U.N. Sustainable Development Goals (SDGs) growth in some of the most important economic sectors across the world.
Such threat can put impediments on the way towards achieving the global goals. Targeted global action must be taken, as experts noted at a forum held by UNCTAD and the Transnational Alliance to Combat Illicit Trade (TRACIT) in July.
To sum up, those who trade illicitly cause both economic, social and environmental losses all over the world. This is a growing issue that must be addressed globally. It’s immensely important that countries collaborate to eradicate the roots of the networks making it so easy to trade illicitly across borders.