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By News Desk
A new report by KPMG the leading accountancy firm, has underlined the growing problem posed by the illicit trade in contraband and counterfeit cigarettes costing Euro-zone countries and the UK, billions in lost revenues. With the UK facing deep public sector cuts the coalition Government and other EU member states are being warned to face up to the threat posed by the illicit tobacco trade from tobacco manufacturers, with Philip Morris International the world's largest manufacturer claiming in a recent announcement that "counterfeit and other illicit cigarettes continue to grow and are an increasing challenge to countries in the EU". With growing movements to clamp down on smoking in the EU, and tobacco control plans likely to push for more regulation of sales at newsagents and supermarkets, consumption of cigarettes has remained stable despite various attempts to "denormalise" smoking.
Timothy Lindon, Philip Morris Chief Compliance Officer & Vice President Brand Integrity, said:
"The illegal cigarette market in the EU is now larger than the legal cigarette markets of France, Ireland and Finland combined, and brings increased criminality to EU member states, as profits from illicit trade are often used to fund other illegal activities, including drug smuggling, human trafficking and terrorism. In many EU countries, there are now two distinct cigarette markets, one legal regulated market which is declining, and an illegal unregulated market that is growing."
The HMRC has estimated the value of UK illicit tobacco trade at £2.2 billion a year with around 1 in 7 cigarettes in the UK now purchased is contraband.
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