- The South African Tobacco Organisation says research commissioned by British American Tobacco SA is designed to tarnish the reputation of its members.
- According to a new Ipsos report, a member of SATO, Gold Leaf Tobacco Corporation's products are among the cheapest on offer in the market, priced below the minimum collectable tax amount of R21.60.
- SATO, however, has said the "smear campaign" has resulted in Gold Leaf Tobacco products being removed from the formal retail sector.
In the past 18 months, cigarette manufacturer Gold Leaf Tobacco Corporation's (GLTC) products have been removed from the formal retail sector due to a "smear campaign" by British American Tobacco South Africa (BATSA), according to the South African Tobacco Organisation (SATO).
SATO on Thursday issued a statement in response to a new Ipsos survey on cigarette pricing, released on Wednesday.
The survey was independently conducted by the market research firm, but was commissioned by BATSA.
It showed that Gold Leaf Tobacco's products were among the cheapest brands on offer, and below the minimum collectable tax price of R21.60 for a packet of cigarettes.
BATSA called for a minimum price of R28 per pack of 20 cigarettes as part of efforts to fight illicit trade. However, SATO, of which Gold Leaf Tobacco is a member, hit out at allegations of illicit trade.
"GLTC emphatically denies all and any allegations of illicit trading and instead wishes to proudly state its significant steady contribution of R200 million per month to the South African economy through the payment of all its taxes," the statement read.
SATO said that the research BATSA relies on is subject to litigation. "We believe these reports are designed specifically to tarnish the reputation of our members."
Contrary to BATSA's proposed minimum price of R28, SATO has called for a minimum price of R22.
"The exorbitant price of R28 as proposed by BAT [SA] is yet another demonstration of abuse of its dominance and cheap attempt to keep its profits up. We believe that the South African consumers should have access to affordable high-quality products, and given the extremely low cost of production, a minimum price of R22 per packet of 20 cigarettes should be introduced," SATO said.