Iran’s Anti-Contraband Drive in Full Swing

In an operation carried out by the Intelligence Ministry on the outskirts of Tehran, seven containers of apparel, textile and accessories worth about 10 billion rials ($2.6 million) were confiscated.

This was announced by the spokesman of the Headquarters for Combating the Smuggling of Commodities and Foreign Exchange, Qasem Khorshidi, on Tuesday, Mehr News Agency reported.

Khorshidi noted that over the 10 months to January 19, contraband hauls, including 1.4 billion cigarettes, 39,000 tons of rice, 208,000 mobile phones, 3.25 million auto parts, 34,000 tons of food products, 18 million pieces of household appliances and 108,000 audiovisual devices were confiscated, registering a 302%, 154%, 18.4%, 292%, 88%, 203% and 240% rise respectively compared with the corresponding period of last year.

“The confiscation of smuggled cosmetics and hygienic products as well as medical equipment and toys also increased by 9%, 88.4% and 87% respectively,” he added.

This week, Mohammad Tahanpour, the head of Iran’s Home Appliances Association, announced that some 90% of contraband household appliances have been confiscated from stores selling these products across the country.

Tahanpour said smuggled products are being sold online, noting that the association has reported some of these sites to relevant officials for prosecution, the Persian economic daily Tafahom reported. 

One-third of all home appliances in the Iranian market is smuggled, an official with the Ministry of Industries, Mining and Trade said last month.

According to Abbas Hashemi, $485 million worth of home appliances were legally imported to Iran while exports stood at $170 million during the eight months to November 20, 2016.

“Smuggled home appliances meet 30-40% of the domestic demand,” he was quoted as saying by Mehr News Agency.

Ali Asghar Ramzi, the head of Tobacco Planning and Supervision Center affiliated with the Ministry of Industries, Mining and Trade, estimates 5.4 billion cigarettes were smuggled into Iran during the nine months to December 20, 2016, noting that the figure indicates a 45% decline year-on-year.

 What to Do With Contraband?

The government has stepped up efforts to curb smuggling that cost the country a whopping $15 billion last year, down by $10 billion compared to the previous year.

Apparel, foodstuff, mobile phones, gold ingots and household appliances top the list of contraband smuggled into Iran, accounting for 41% of the illegal goods.

This is while what happens to the confiscated items and whether they should be destroyed, distributed in the domestic market or sold abroad, is a matter of heated debate between officials and economists.

About 400 tons of smuggled goods, including food items and clothing, worth 150 billion rials ($4.24 million) were destroyed in Tehran in August 2016, in what is said to be the largest destruction of contraband in Iran in 38 years. 

Chief Prosecutor of the Supreme Court of Iran Mohammad Jafar Montazeri told the Persian economic daily Hadaf va Eghtesad that he believes the only effective way of combating smuggling is to destroy the seized contraband items.

Economist Mohammad Hossein Barkordar is of the opinion that it has to be made clear, once and for all, to smugglers that if seized, their goods will be dumped, they will never be able to lay their hands on them again and will incur losses. 

“Since most of the time, contraband items are of poor quality, they won’t be welcomed in other countries and reexporting them will not benefit us in any way,” he said.

Masoud Amjadipour, another economist, also believes that the shortcomings and discrepancies in the tariff policies of the Islamic Republic of Iran Customs Administration encourage smuggling. He said officials need to reassess the regulations and undertake reforms.