The Economist: Tunnel vision

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July 25, 2012, 10:11 a.m. | Ukraine abroad — by Economist

The tunnel begins in a house in the Ukrainian city of Uzhorod and exits inside a building some 220 metres into Slovak territory on private property between the villages of Vyšné Nemecké and Nižné Nemecké. Officials estimate the tunnel could have helped dodge up to €50 m in tobacco tax over the past year.

SLOVAK officials discovered a 700-metre tunnel complete with its own train used to smuggle goods and maybe people from neighbouring Ukraine into the European Union. 

They seized some 13,100 boxes of cigarettes and arrested a pair of men caught in the act. This has never happened before. "It is as if this has been cut out of a movie from the Mexican-American border,” Peter Kažimír, the finance minister, said.

The bust came as a joint effort between tax and customs officials in an operation code named “Tax Cobra.” Robert Kaliňák, the interior minister, said officials detained two men loading a truck on July 18th, confiscating a tobacco haul that would have bypassed some €350,000 in excise tax. Police had to fire warning shots as the 59-year-old allegedringleader – who was renting the industrial property where the tunnel emerged -- sought to flee the scene.

Read more here. 

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