Tobacco increase 'reasonable': BAT South Africa

"For us [this] is an acknowledgement by government of the significant problem of the illegal trade in cigarettes," spokeswoman Leslie Rance said.

"This is also to blame for approximately R4 billion loss in government revenue due to evasion of taxes on illegal cigarettes."

He said trade in illegal cigarettes remained a major concern in South Africa.

"Around 28% of cigarettes sold in South Africa are illegal."

The retail price of a 20s packet of Peter Stuyvesant, the company's biggest-selling brand, would increase by R1 from Monday.