The share of illegal tobacco products in the Ukrainian market in February 2021 amounted to 12.8% versus 5.8% in February 2020, the figure is the highest since 2011 and is mainly due to the growth of illegal sales of cigarettes and Duty Free products intended for export.
Such data were published by the research institute Kantar Ukraine by order of the ten largest Ukrainian manufacturers of tobacco products.
According to researchers, 62% of illegally sold tobacco products in the country have a mark of production at Vynnyky Tobacco Factory (Vynnyky, Lviv region) and are labeled as export or Duty Free products not intended for sale in Ukraine. The share of unidentified manufacturers is 23%, and United Tobaco LLC (Zhovti Vody, Dnipropetrovsk region) – 15%.
The most common brands of this group of illegal products are the Compliment brand marked as Duty Free – with a share of 50%, as well as those intended for export, but sold in Ukraine, Marshall (14%), Jin Ling (9%), Marvel and Urta (6% each). The total share of the named brands in this product group is 84%.
Kantar noted that 42% of smuggled cigarettes are products of Grodno Tobacco Factory (Belarus), and 20% are products of Moldovan factories. The most common smuggled brands are Credo, Queen, Ritm, Oris, NZ and Armeyskiye (Moldova).
The study showed that 63% of illegal products are distributed in six regions of Ukraine. Most of all – in Kharkiv (14%), Donetsk and Odesa (13%), Dnipropetrovsk (9%), Mykolaiv (7%) and Khmelnytsky (6%) regions.
According to Kantar, the share of illegal products sold through legal trade channels continues to grow: in February 2021, some 36% of illegal products were distributed through stalls, 29% – shops, 23% – open markets, and 9% – street trading.
Researchers estimated state budget’s losses from unpaid taxes at UAH 11.8 billion over 2021.
