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Tag: illicit cigarettes

  • Illicit Cigarettes Dominate South Africa’s Tobacco Market

    Illicit Cigarettes Dominate South Africa’s Tobacco Market

    Illicit cigarettes account for around 60% of South Africa’s market, according to new research from the University of Cape Town, highlighting a sharp rise from about 30% prior to the COVID-19 pandemic. The study found the surge represents a structural shift in the industry, with major players losing share while local producers linked to low-priced products have expanded significantly, selling cigarettes at levels suggesting taxes are not being paid.

    The findings also show illicit products are concentrated in informal retail channels and are disproportionately consumed by lower-income, heavy smokers, driven by cheaper pricing. Researchers say the scale of the illicit trade is undermining tax revenues and reshaping market dynamics, with calls for stronger supply chain controls and enforcement measures to address the issue.

  • Illicit Cigarette Trade Surges in Latin America and Canada

    Illicit Cigarette Trade Surges in Latin America and Canada

    Illicit cigarettes accounted for 31.9% of total consumption across Latin America and Canada in 2025 — equivalent to 77 billion sticks — resulting in an estimated $8.5 billion in lost tax revenues, according to a report released by Philip Morris Products S.A. The study, conducted by KPMG LLP, examined the Region of the Americas (excluding the United States) and found that the region now has the highest global incidence of illicit tobacco, driven by steep tax increases and regulatory pressures that have pushed consumers toward cheaper illegal products.

    The findings highlight growing fiscal, public health, and enforcement challenges, with markets such as Brazil, Panama, and Ecuador particularly affected, underscoring calls for more balanced regulation and stronger anti-illicit trade measures. Brazil has the region’s largest illicit market with 41.8 billion illicit cigarettes, while illicit cigarettes make up 89% of Panama’s market and 84% of Ecuador’s.

  • Illicits Cutting into Malaysian Sundry Shop Sales Beyond Cigarettes

    Illicits Cutting into Malaysian Sundry Shop Sales Beyond Cigarettes

    Sundry shops across Malaysia are losing customers to widespread illegal cigarette sellers, according to the Federation of Sundry Goods Merchants Associations of Malaysia. Its president, Hong Chee Meng, said illicit sales by unlicensed retailers, including outlets run by migrant workers outside the association, are undercutting legitimate family-run businesses that comply with regulations and contribute to government revenue.

    With legal cigarette prices ranging from RM12.40 to RM18.40 ($3.10 to $4.60) per pack versus RM3 to RM8 ($0.75 to $2) for illicit products, the price gap is drawing smokers away from compliant retailers. Hong said cigarettes are a key traffic driver for sundry shops, and when customers buy from illegal sellers, shops also lose add-on purchases such as drinks, snacks, and household goods, compounding the impact on small businesses.

  • 100,000 Illicit Cigarettes Seized at The Hague Supermarket

    100,000 Illicit Cigarettes Seized at The Hague Supermarket

    A coordinated inspection by the The Hague Economic Intervention Team uncovered 102,800 illegal cigarettes at a supermarket in Rustenburg Oostbroek, The Hague. The cigarettes lacked Dutch excise stamps, indicating unpaid taxes and violations of the Excise Act. Officers from Dutch Customs found the products hidden in concealed compartments inside the store and in two company vehicles, which were also confiscated after being linked to repeated illicit trade activity.

    The operation involved partners across the HEIT network, including municipal authorities, police, the food and consumer product safety authority, labor inspectors, and social services, reflecting a broader push to combat economic crime and “undermining” activity tied to illicit tobacco. Local sources indicated this was not the first time illegal cigarettes had been discovered at the business during inspections.

  • Philippine Farmers Hail Illicit Tobacco Crackdown

    Philippine Farmers Hail Illicit Tobacco Crackdown

    Farmers in the Philippines and local business groups welcomed the government’s intensified crackdown on illicit tobacco manufacturing and smuggling, following a series of enforcement operations. Organizations, including the Federation of Free Farmers, Federation of Philippine Industries, and the British Chamber of Commerce of the Philippines said recent raids and factory shutdowns send a strong signal that authorities are serious about protecting legitimate businesses, government revenues, and farmers’ livelihoods. The comments followed law enforcement actions that uncovered several abandoned illegal cigarette factories in Pampanga and seized equipment and materials valued at about ₱400 million ($6.8 million).

    Officials said the illegal facilities were capable of producing cigarettes worth up to ₱160 million per day. Authorities estimate that illegal cigarette production and smuggling cost the Philippine government around ₱30 billion ($510 million) in lost excise taxes in 2025 alone. Department of the Interior Secretary Jonvic Remulla warned that some illicit operations may have political or institutional backers, while enforcement agencies continue investigations to identify financiers and operators behind the networks.

  • Illicit Cigarettes Threaten Malaysia’s Micro-Businesses

    Illicit Cigarettes Threaten Malaysia’s Micro-Businesses

    The Malaysian Micro Businesses Association (MAMBA) highlighted the growing impact of illicit cigarette sales on local small enterprises, following NielsenIQ’s Illicit Cigarettes Study 2025. The study found that illegal cigarettes now account for 54.4% of total cigarette consumption, creating steep competition for micro businesses such as sundry shops, coffee shops, and neighborhood kiosks.

    With legal cigarettes costing RM18.40 ($4.60) and illicit ones as low as RM3 ($0.75), MAMBA Secretary-General Alvin Low said the wide price gap encourages consumers to bypass legitimate retailers, undermining micro-enterprises that comply with licensing, taxation, and health regulations. He stressed that this distorted market threatens the broader micro-business ecosystem, which comprises 97.4% of Malaysian businesses, and called for a balanced approach combining enforcement with measures to stabilize the legal market.

  • Ireland Seizes €8.5 Million Worth of Illegal Cigarettes

    Ireland Seizes €8.5 Million Worth of Illegal Cigarettes

    Irish authorities seized about 9 million illegal cigarettes at Dublin Port during an inspection of a container arriving from Rotterdam. Officers from Revenue Irish Tax and Customs discovered the cigarettes, branded “Richmond,” concealed in a shipment declared as food after conducting routine risk profiling, assisted by a detector dog and a mobile X-ray scanner.

    The cigarettes have an estimated retail value of more than €8.5 million and represent a potential loss to the Irish Exchequer of over €6.6 million in unpaid taxes. Authorities said the seizure forms part of ongoing efforts to combat the illegal tobacco trade and the wider shadow economy, with investigations continuing.

  • Philippines Losing $425M to Illicits

    Philippines Losing $425M to Illicits

    The Philippines is losing an estimated P25 billion ($425 million) annually in cigarette excise taxes due to the illicit tobacco trade, according to a policy brief by the Center for Market Education (CME). The report, which compares seven ASEAN economies, found that smuggled cigarettes account for about 16% of the domestic market, with some estimates reaching as high as 21%. CME CEO Carmelito Ferlito said the foregone revenue represents a significant missed opportunity to fund public services.

    The brief noted that the lost money is equivalent to 12.5% of the national health budget and 3.6% of the education budget, funds that could otherwise support hospitals, schools, and climate programs. While tobacco excise collections surged after major reforms in 2012, revenues peaked in 2021 and have declined since, raising concerns that rates may have exceeded the revenue-maximizing point on the Laffer Curve. CME urged policymakers to align tax policy with stronger enforcement, stressing that taxation is effective only when compliance is enforceable and credible.

  • Dutch Customs Seize 12.5M Illegal Cigarettes in Two Weeks

    Dutch Customs Seize 12.5M Illegal Cigarettes in Two Weeks

    Dutch investigators from the Fiscale Inlichtingen- en Opsporingsdienst seized 12.5 million illegal cigarettes in three separate operations over the past two weeks, preventing an estimated €4.2 million in lost excise revenue, according to the Ministry of Finance. The first haul, more than 3.5 million cigarettes, was uncovered on Jan. 28 in Rotterdam hidden inside a container of plastic crates, while a second seizure of 6.5 million cigarettes followed a customs check at Rotterdam port, where cartons were concealed within wooden sauna crates. A further 2.5 million cigarettes were found in raids at premises in Vlijmen and a warehouse in Den Bosch, with authorities stating the tobacco was intended for illegal sale in the Netherlands. One suspect has been arrested, and further arrests have not been ruled out.

  • Cigarette Balloons Cause Poland to Summon Belarus Envoy

    Cigarette Balloons Cause Poland to Summon Belarus Envoy

    Poland has summoned Belarus’s charge d’affaires after dozens of meteorological balloons carrying untaxed cigarettes crossed into Polish airspace from Belarus, in what authorities described as mass smuggling attempts. The Polish Foreign Ministry said border guards and police recovered balloon debris and cigarette shipments—some carrying up to 1,500 packs—in several eastern regions, including near the Belarus border and in Białystok. Warsaw warned Minsk that it does not consent to such actions and said further incidents would have consequences, while questioning Belarus’s claim of having no knowledge of the operations. Polish media reported around 150 such balloon incidents to date.