FITA Press Release – 18 September 2018

Press release – FITA – for immediate release

In response to: “Right of reply: Tobacco Institute of Southern Africa (TISA) response to M&G article.
FITA has noted the attempts by TISA to respond to legitimate questions posed by the media with respect to their and their members’ orchestrated #TakeBackTheTax campaign. The right to a reply is a constitutional right, and should be respected. But the response by TISA head, Mr François van der Merwe does little to address the real issues. In fact, it raises even more questions.
Mr Van der Merwe is at pains to point to losses to the fiscus, yet remains silent on the issue of Base Erosion and Profit Shifting (BEPS) tactics implicating TISA members worldwide and specifically in developing states in Africa. Studies conducted by the Thabo Mbeki Foundation on Illicit Financial Outflows from South Africa and African countries show clearly how BEPS is part of this problem of billions flowing out of African economies. Multinationals are the only companies that can engage in these questionable practices. Perhaps Mr Van der Merwe can enlighten the public as to why the Ipsos study did not consider all ways in which losses to the fiscus manifest, particularly if the process was intended to seek ways to “take back the tax”? Why stay silent on this particular issue? Perhaps TISA could enlighten the public on the billions that have flowed from South African shores that are attributable to its members?
The refusal to release the Ipsos report and explanation why TISA does not want to do so, cannot hold water. If they were so sure of their findings, the underlying evidence supporting these would logically make their case. This reluctance to release the actual report is suspect. It smacks of similar behaviour by multinationals implicated in State Capture that have also refused to publicly release reports implicating their own employees. It seems more delaying tactic than anything else. Prime examples are McKinsey, SAP, Steinhoff, Bain & Co and KPMG. Much effort is spent to justify why the public cannot see reports commissioned, yet the same public is expected to accept at face value whatever agenda is being advanced.
This phenomenon applies to TISA’s biggest member, British American Tobacco, which is the subject of an investigation by the United Kingdom’s Serious Fraud Office. They have been implicated in a host of allegations, including racketeering, bribery, corruption, money laundering and industrial espionage. Their investigative reports into the aforementioned allegations and compiled by law firms Norton Rose Fulbright and Slaughter & May commissioned in 2016 have yet to see daylight.
Perhaps TISA and its members must be honest with the public for once, take us into their confidence and release these reports for once and for all. It is one thing to point fingers at commercial competition, waiving findings of a report as supposed proof, whilst simultaneously refusing to provide the underlying documents, and crying foul all the time. It is an entirely different thing, if TISA insisted that its members, such as British American Tobacco, release the findings of reports which relate to allegations implicating them in organised crime.
It is really about people living in glass houses and black pots and kettles, Mr Van der Merwe. There should be no need to pay money to public personalities who claim to be anti-crime activists. Surely TISA cannot miss the irony in this sort of practice? Perhaps TISA can ask their paid activists to also inform the public about BEPS practices and the evidence in the public domain which implicates British American Tobacco. Maybe these paid activists can do the South African public the favour of having a direct conversation with you to convince you why the release of these reports are in the interests of justice?
Perhaps, while TISA contemplates doing so, it should also publicly release its planned campaign documents, especially those that sought to “influence the media to get headlines across the country”, and to further “influence government agencies”? These themes and approaches appear awfully similar to the allegations of State Capture we have seen of late.
Put TISA’s money where its mouth is, Mr Van der Merwe. Tell the public how much corporate taxes have been diluted with BEPS practices in the tobacco industry and publicly release the British American Tobacco reports. Inform the public how state officials had been captured and compromised to do TISA and its members’ bidding for years. Call a press conference to do so, and ask your paid activists to assist you to enlighten the public on these issues. Until you do so, TISA can shout as loud as it wants – it is clear that the media and the public aren’t buying your narrative that easily anymore. Too many relevant questions remain unanswered.

Issued by the Fair-trade Independent Tobacco Association: 18 September 2018
For queries kindly contact Monique Vogel t: 011 044 5355; e: Monique@fita.co.za
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