Romania loses EUR 670 mln revenues due to cigarette smuggling

The black market for cigarettes in Romania reached an average level of 16.8% of the total cigarette market in 2016, which is the highest share in the past five years, according to market research company Novel Research.

The illegal cigarette trade is a major source of losses for the state, as the tobacco industry is the second biggest contributor to the state budget.

“In 2016, the state lost some EUR 672 million, which went into the smugglers’ pockets instead of financing the Government’s priorities,” said Ileana Dumitru, Director Legal & External Affairs at BAT Romania, the biggest player in the local tobacco sector.

The authorities hope to reduce the cigarette black market through a new anti-smuggling strategy. “Our objective is to reach a contraband level as close as possible to the EU average of 10%,” said Dorel Dronea, vice president of the tax agency ANAF in charge of coordinating local customs structures.

The highest black market level was recorded in Romania’s North-East region, where illegal trade reached 42% of the total cigarette market, due to smuggling operations from Ukraine and the Republic of Moldova. In Western Romania, the black market for cigarettes is also over 20% of the total, according to Novel Research data.

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