New KPMG Report Shows Illicit Cigarette Consumption Still at Worrying Levels in the European Union, With Organized Crime Moving Operations Closer to Western Countries
Philip Morris International (PMI) warns about high levels of illicit cigarette consumption in the European Union, with 35.2 billion illicit cigarettes consumed in 2023, accounting for 8.3% of total consumption. The KPMG report commissioned by PMI reveals that counterfeit cigarettes remain a major source of illicit consumption, with 12.7 billion cigarettes consumed. France leads as the country with the largest illicit consumption in Europe, with 16.8 billion illicit cigarettes and an estimated €7.3 billion in lost tax revenues.
PMI calls for a holistic approach to curb illicit trade, including law enforcement, awareness campaigns, and a predictable fiscal environment. The company emphasizes the need for innovative approaches to reduce smoking prevalence and advocates for smoke-free alternatives. PMI's survey across 14 European countries shows that 60% of adults believe their country has a problem with illicit tobacco products, and 77% agree that illicit trade robs governments of significant tax revenue.
Philip Morris International (PMI) avverte riguardo ai livelli elevati di consumo illecito di sigarette nell'Unione Europea, con 35,2 miliardi di sigarette illecite consumate nel 2023, che rappresentano l'8,3% del consumo totale. Il report KPMG commissionato da PMI rivela che le sigarette contraffatte rimangono una delle principali fonti di consumo illecito, con 12,7 miliardi di sigarette consumate. La Francia si posiziona come il paese con il maggiore consumo illecito in Europa, con 16,8 miliardi di sigarette illecite e una stima di 7,3 miliardi di euro di entrate fiscali perse.
PMI chiede un approccio olistico per contrastare il commercio illecito, inclusi l'applicazione della legge, campagne di sensibilizzazione e un ambiente fiscale prevedibile. L'azienda sottolinea la necessità di approcci innovativi per ridurre la prevalenza del fumo e promuove alternative senza fumo. Il sondaggio di PMI in 14 paesi europei mostra che il 60% degli adulti crede che il proprio paese abbia un problema con i prodotti del tabacco illeciti e il 77% concorda sul fatto che il commercio illecito privi i governi di significative entrate fiscali.
Philip Morris International (PMI) advierte sobre los altos niveles de consumo ilícito de cigarrillos en la Unión Europea, con 35.2 mil millones de cigarrillos ilícitos consumidos en 2023, lo que representa el 8.3% del consumo total. El informe de KPMG encargado por PMI revela que los cigarrillos de contrabando siguen siendo una fuente importante de consumo ilícito, con 12.7 mil millones de cigarrillos consumidos. Francia se posiciona como el país con el mayor consumo ilícito en Europa, con 16.8 mil millones de cigarrillos ilícitos y una pérdida estimada de 7.3 mil millones de euros en ingresos fiscales.
PMI solicita un enfoque holístico para frenar el comercio ilícito, que incluya la aplicación de la ley, campañas de concienciación y un entorno fiscal predecible. La empresa enfatiza la necesidad de enfoques innovadores para reducir la prevalencia del tabaquismo y aboga por alternativas sin humo. La encuesta de PMI en 14 países europeos muestra que el 60% de los adultos creen que su país tiene un problema con los productos de tabaco ilícitos, y el 77% está de acuerdo en que el comercio ilícito despoja a los gobiernos de ingresos fiscales significativos.
필립 모리스 인터내셔널 (PMI)는 유럽 연합 내 불법 담배 소비 수준이 높다는 경고를 하고 있으며, 2023년에 352억 개의 불법 담배가 소비되어 전체 소비의 8.3%를 차지하고 있습니다. PMI가 의뢰한 KPMG 보고서에 따르면, 위조 담배는 여전히 불법 소비의 주요 원천으로, 127억 개의 담배가 소비되고 있습니다. 프랑스는 유럽에서 가장 많은 불법 소비가 이루어지는 국가로, 168억 개의 불법 담배가 소비되며, 세수 손실은 73억 유로로 추정됩니다.
PMI는 불법 거래를 억제하기 위한 포괄적인 접근 방식을 촉구하며, 법 집행, 인식 캠페인, 그리고 예측 가능한 세무 환경을 포함합니다. 이 회사는 흡연율을 줄이기 위한 혁신적인 접근 방식을 필요하며, 무연 대안을 지지합니다. PMI의 14개 유럽 국가를 대상으로 한 조사에서는 60%의 성인이 자국에서 불법 담배 제품 문제가 있다고 믿고, 77%는 불법 거래가 정부의 상당한 세수 손실을 초래한다고 동의하고 있습니다.
Philip Morris International (PMI) met en garde contre les niveaux élevés de consommation illicite de cigarettes au sein de l'Union Européenne, avec 35,2 milliards de cigarettes illicites consommées en 2023, représentant 8,3 % de la consommation totale. Le rapport KPMG commandé par PMI révèle que les cigarettes contrefaites restent une source majeure de consommation illicite, avec 12,7 milliards de cigarettes consommées. La France se classe en tête des pays ayant la plus grande consommation illicite en Europe, avec 16,8 milliards de cigarettes illicites et une estimation de 7,3 milliards d'euros de revenus fiscaux perdus.
PMI appelle à une approche holistique pour freiner le commerce illicite, incluant l'application de la loi, des campagnes de sensibilisation, et un environnement fiscal prévisible. L'entreprise souligne la nécessité d'approches innovantes pour réduire la prévalence du tabagisme et plaide pour des alternatives sans tabac. L'enquête menée par PMI dans 14 pays européens montre que 60 % des adultes estiment que leur pays a un problème avec les produits du tabac illicites, et 77 % sont d'accord pour dire que le commerce illicite prive les gouvernements de revenus fiscaux significatifs.
Philip Morris International (PMI) warnt vor hohen Konsumzahlen illegaler Zigaretten in der Europäischen Union, mit 35,2 Milliarden illegal konsumierten Zigaretten im Jahr 2023, was 8,3% des Gesamtverbrauchs ausmacht. Der von PMI in Auftrag gegebene KPMG-Bericht zeigt, dass gefälschte Zigaretten eine Hauptquelle für den illegalen Konsum bleiben, mit 12,7 Milliarden konsumierten Zigaretten. Frankreich führt die Liste der Länder mit dem höchsten illegalen Konsum in Europa an, mit 16,8 Milliarden illegalen Zigaretten und geschätzten 7,3 Milliarden Euro an verlorenen Steuereinnahmen.
PMI fordert einen ganzheitlichen Ansatz zur Bekämpfung des illegalen Handels, der Gesetzesvollzug, Aufklärungskampagnen und ein vorhersehbares fiskalisches Umfeld einschließt. Das Unternehmen betont die Notwendigkeit innovativer Ansätze zur Verringerung der Raucherquote und setzt sich für rauchfreie Alternativen ein. Eine Umfrage von PMI in 14 europäischen Ländern zeigt, dass 60% der Erwachsenen glauben, dass ihr Land ein Problem mit illegalen Tabakprodukten hat, und 77% stimmen zu, dass illegaler Handel den Regierungen erhebliche Steuereinnahmen entzieht.
- PMI's smoke-free products are now available in 90 markets worldwide
- Smoke-free business accounted for approximately 38% of PMI's total first-half 2024 net revenues
- PMI estimates that 36.5 million adults around the world use their smoke-free products
- PMI has invested over $12.5 billion since 2008 to develop and commercialize innovative smoke-free products
- Illicit cigarette consumption in the EU increased by 0.1 percentage point compared to 2022
- Governments in the EU lost an estimated €11.6 billion in tax revenue due to illicit cigarette trade, up from €11.3 billion in 2022
- Counterfeit cigarette consumption has increased for the fourth consecutive year across Europe
- Total non-domestic consumption across 38 European countries has reached its highest level ever at 15.5%
Insights
The KPMG report reveals a concerning trend in the European tobacco market. With 35.2 billion illicit cigarettes consumed in the EU in 2023, accounting for
Key insights include:
- France leads with 16.8 billion illicit cigarettes consumed
- EU governments lost an estimated
€11.6 billion in tax revenue - 113 clandestine cigarette factories were disrupted in 22 European countries
- Counterfeit cigarettes remain a major source, with 12.7 billion consumed
These figures suggest that current policies are insufficient in addressing the illicit tobacco trade, potentially impacting legitimate businesses and government revenues. The shift of illegal manufacturing closer to Western European markets indicates evolving criminal strategies that may require new approaches from law enforcement and policymakers.
The persistence of illicit cigarette trade in the EU presents significant legal challenges. The report highlights the need for a more robust legal framework to combat organized crime's involvement in this sector. Key legal considerations include:
- Enhanced cross-border cooperation among law enforcement agencies
- Stricter penalties for illicit manufacturing and distribution
- Improved tracking and tracing systems for tobacco products
- Harmonization of tax policies to reduce incentives for smuggling
The establishment of 113 clandestine factories closer to Western European markets suggests a need for more targeted legal strategies. Policymakers should consider updating existing regulations to address these evolving criminal tactics, potentially including stronger supply chain controls and increased resources for enforcement agencies. The
From a public health perspective, the persistent high levels of illicit cigarette consumption in the EU are deeply concerning. This trend undermines efforts to reduce smoking prevalence and protect public health. Key health implications include:
- Increased accessibility to cheaper, unregulated tobacco products
- Potential exposure to more harmful substances in counterfeit cigarettes
- Undermining of youth access prevention measures
- Reduced effectiveness of tax-based tobacco control policies
The report's findings that
- More than 35 billion illicit cigarettes were consumed across the 27 EU member states in 2023, close to 2022 figures.
-
France continues to be the largest illicit market in the EU, and now accounts for47.7% of total illicit cigarette consumption in the region. -
Illicit consumption has grown for the fifth consecutive year in
Europe , reaching 52.2 billion cigarettes across the 38 countries included in this study. Nearly one in 10 cigarettes in the continent are illicit. - More than 110 clandestine cigarette factories were dismantled in 2023, as illegal manufacturing sites are being set up nearer large end markets.
LAUSANNE,
PMI praises European law enforcement agencies for their continued crackdown on criminal networks that profit from the illicit tobacco trade, and calls on regulators to advance a sensible, data-driven policy approach that puts consumers—and public health—front and center and that effectively addresses the challenges posed by the millions of adult smokers who are turning to the black market rather than quitting or, for those who do not quit, switching to smoke-free products.
The results of the 2023 KPMG annual study on illicit cigarette consumption, commissioned by Philip Morris Products SA, revealed that the illicit market in the EU continues to be a major threat for public health, public security, and states’ economies. Counterfeit cigarettes remain one of the main sources of illicit consumption in the region, with 12.7 billion (
“We are witnessing an evolution of organized crime groups in
Interviews with law enforcement agencies included in the KPMG report shed light onto transnational organized crime’s professionalization of their role in the supply chain of illicit cigarettes. According to information from law enforcement agencies, publicly available media articles, and PMI estimates, criminals have expanded the setup of illegal cigarette factories; in 2023 alone, law enforcement data shows that at least 113 clandestine cigarette manufacturing sites in 22 European countries were disrupted by regional and local authorities.
The steady increase of counterfeit cigarette consumption for the fourth consecutive year across Europe—mainly driven by the
Despite this scenario, KPMG revealed that in 26 European countries illicit consumption share was less than
“It’s truly encouraging to see a decrease in illicit consumption in countries like
“If we want to tackle illicit trade, governments must deploy relentless law enforcement action against criminals profiting from the black market. This has proven successful over excessive taxation on consumer goods, or even prohibition,” added Harpantidis. “In order to end smoking overall, traditional tobacco control policies must be complemented with innovative approaches. Governments must recognize that embracing alternatives to cigarettes for those adults who would otherwise continue to smoke will reduce smoking-related harm much faster than existing measures alone.”
The KPMG report has expanded to 38 European countries
For the first time since its publication in 2006, the KPMG annual research study has broadened its scope and incorporated all Balkan countries. Now, the research covers 38 countries: the 27 EU member states, as well as
The Balkan region has shown lower presence of illicit cigarettes compared to some of the Western European countries, such as
This is the 18th consecutive year that KPMG has estimated illicit cigarette consumption across
What are Europeans saying?
Illicit trade has a direct impact on people’s lives across
To better understand societal views regarding illicit trade, PMI commissioned independent public opinion research firm Povaddo to conduct a survey among adults in 14 European countries. The survey, which was executed in January 2024, found that:
-
More than half (
60% ) believe their country (and the EU as a whole) has a problem with illicit tobacco and illicit nicotine-containing products. -
Almost three quarters (
74% ) agree that governments must consider illicit trade as an unintended consequence when deciding how to regulate and tax tobacco and nicotine-containing products. -
77% agree that illicit trade robs governments of significant tax revenue.
Illicit trade fuels ruthless criminal gangs, often impacting the most vulnerable communities and populations. It deprives governments of tax revenue needed to provide public services, including security. The proceeds from illicit trade often help facilitate other serious crimes such as human trafficking, corruption, and money laundering.
For PMI, eliminating the illicit tobacco trade has been a long-standing priority. We implement preventive and protective measures to fight illicit trade and work with public and private sectors to advance efforts against this global issue.
As we advance on our journey toward delivering a smoke-free future, we are increasing our efforts to secure both our supply chain and the products we sell and to protect consumers and our brands from smugglers and counterfeiters. We collaborate with law enforcement agencies and other organizations all over the world to root out and shut down illegal activities, including counterfeiting and smuggling operations. PMI also continues to support relevant European regulations, such as the EU Tobacco Products Directives’ tracking-and-tracing provisions.
A detailed overview of the results and methodology of the KPMG report is available here.
For more information about PMI’s illicit trade prevention efforts, visit PMI.com.
Note to editors
Definitions of illicit cigarette categories, as detailed in the KPMG report
- Counterfeit: Illegally manufactured and sold by a party other than the original trademark owner. In the KPMG report, counterfeit volumes are reported from the participating manufacturers of BAT, IB, JTI, and PMI.
- Illicit whites: Usually manufactured legally in one country/market, but which the evidence suggests have been smuggled across borders during their transit to the destination market under review, where they have limited or no legal distribution and are sold without payment of tax.
- Other C&C: Mainly contraband, i.e., genuine products that have been either bought in a lower-tax country and that exceed indicative quantities/limits or acquired without taxes for export purposes to be illegally resold (for financial profit) in a higher-priced market. This category may also contain counterfeits of brands that are not trademark-owned by empty pack survey participant manufacturers.
Povaddo survey methodology
PMI commissioned Povaddo LLC to field the survey in the following countries:
Philip Morris International: Delivering a Smoke-Free Future
Philip Morris International (PMI) is a leading international tobacco company, actively delivering a smoke-free future and evolving its portfolio for the long term to include products outside of the tobacco and nicotine sector. The company’s current product portfolio primarily consists of cigarettes and smoke-free products. Since 2008, PMI has invested over
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Philip Morris International
David Fraser
T. +41 (0)58 242 4500
E. david.fraser@pmi.com
Source: Philip Morris International
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