Ukraine Restricts Duty-Free Tobacco Sales

Ukraine has restricted the duty-free sales of cigarettes and alcohol, reports Interfax.

The law, which signed into law by President Volodymyr Zelenskyy on Sept. 1, 2023, prohibits goods that fall under a certain categories of the Ukrainian Classification of Commodities from being registered as duty-free commodities until the country lifts the martial law that has been in effect since Russia’s invasion.

The measure is intended to tackle illegal trade in tobacco products. Despite restrictions on foreign travel after the breakout of hostilities in early 2022, the number of cigarette packs purchased near borders rose sharply compared with those sold at other outlets, causing the Ukraine to miss out on substantial tax earnings.

An ad hoc investigative commission created at the urging of the State Tax Service in May 2023, suggested stricter controls on tobacco manufacturers and exporters.