Anti-smoking group Fresh is calling for tougher penalties against those caught dealing in illicit tobacco on Wearside as a national consultation looks at effective ways of tackling the black market.
Those who smuggle, distribute and sell illegal tobacco, which often ends up in the hands of children on North East estates, could be hit by a four-fold increase in fines to deter sales.
HMRC has launched a national consultation setting out proposals to create tougher sanctions, which include a steep increase in fines, increasing for first offences from £175 up to £250, for second offences from £750 to £1,500, and rising from £750 to £3,000 for fourth offences, more naming of businesses and crime gangs who evade tobacco duty and a new civil penalty for those flouting tax marks.
National HMRC tax gap figures show that the illicit market for cigarettes has fallen from 22% in 2000-01 to 13% in 2015-16, and for hand-rolling tobacco from 61% to 32% of the whole tobacco market.
The amount of tax lost to the illicit market has been driven down from £3.4billion a year to £2.4billion a year.
However, tobacco fraud remains a serious problem with HMRC estimating that in 2015-16, five billion illicit cigarettes and 3,200 tonnes of illicit hand-rolling tobacco were consumed in the UK.
Ailsa Rutter, director of Fresh, said: “The illicit tobacco trade helps enable children to buy cigarettes, undermines public health and deprives schools and hospitals.
“There are also cases of sellers linked to loan sharking and drugs.
“The Government needs to send out a strong message this is not a victimless crime.”