Kiosk owners in Cyprus are warning that proposed tobacco tax increases could drive consumers toward illegal markets, particularly via the island’s northern region, where price disparities already influence purchasing behavior. Industry estimates suggest that about 13% of cigarette consumption and 53% of rolling tobacco consumption currently comes from the north, with further increases expected if taxes rise.
Retailers say planned EU-driven excise adjustments could push cigarette prices from around €4.50–€5 to as high as €8–€8.50 per pack, potentially accelerating the shift to untaxed products. The sector estimates illicit trade already costs the government more than €50 million annually and is calling for policy flexibility, stronger enforcement and phased implementation to mitigate further losses.