Impact exposed

The illicit trade in cigarettes caused EU governments to miss out on €10 billion ($11.28 billion) in tax revenues in 2018, according to the Project Stella Report.

Prepared by KPMG and commissioned by Philip Morris Products, the Stella Report notes that the EU black market for cigarettes was equivalent in size to the total legal cigarette sales in the U.K., Austria and Denmark combined.

Overall illicit cigarette consumption levels remained stable compared with the previous year; however, the report found a more than 30 percent increase in counterfeit consumption—the largest amount recorded to date.

“Beyond damaging government revenues, harming legitimate businesses and fueling crime in local communities, the availability of cheap, unregulated cigarettes on the black market undermines efforts to reduce smoking prevalence and prevent youth from smoking,” said Alvise Giustiniani, vice president of illicit trade prevention at Philip Morris International.

“For PMI to have impact in our drive to ‘unsmoke’ the world, we must sustain our combined efforts to eliminate illicit cigarette trade, while ensuring responsible access to better alternatives for the men and women who would otherwise continue to smoke.”

According to the report, illicit cigarette consumption in the E.U. in 2018 was 8.6 percent of total consumption, representing 43.6 billion cigarettes.