NEW DELHI: Smuggling and counterfeiting is estimated to cost the government
a whopping Rs 26,190 crore in tax losses annually, a study conducted by industry
The report, part of the campaign on consumer rights, on the socio-economic
impact of counterfeiting, smuggling and tax evasion on seven key Indian industry
sectors was released today.
The special study brought out by FICCI and Committee Against Smuggling and
Counterfeiting Activities Destroying the Economy
(CASCADE) added that overall the industry bears an annual sales loss of Rs 1
lakh crore due to these two menaces.
"According to the study the estimated annual tax loss to government is Rs
26,190 crore. The overall estimate of annual sales loss to industry is put at Rs
1,00,000 crore as per the report," the study prepared by Thought Arbitrage
Research Institute (TARI) said.
The key sectors which were included in the study were auto components,
alcohol, computer hardware, FMCG
(personal goods), FMCG (packaged goods), mobile phones and tobacco.
The report is an attempt to estimate the size of the grey
market for selected industry sectors in India and projected the economic
loss to industry, government and consequent social impact, Ficci said.
"The maximum tax loss on account of smuggled and counterfeit products to
government is from the tobacco sector at Rs 6,240 crore followed by FMCG
(packaged food) at Rs 5,660 crore and FMCG (personal goods) at Rs 4,646 crore,"
The highest loss to industry in terms of revenue is from FMCG (packaged
goods) at Rs 20,378 crore (23.4 per cent), FMCG (personal goods) at Rs 15,035
crore (25.9 per cent), auto components at Rs 9,198 crore (29.6 per cent), mobile
phones at Rs 9,042 crore (20.8 per cent) and tobacco at Rs 8,965 crore (15.7 per
cent), it said.