ECONOMY

Greece is EU’s contraband tobacco leader

greece-is-eu-s-contraband-tobacco-leader

Greece has the highest rate of contraband cigarettes in the European Union, which cost the state coffers 690 million euros in revenues last year, as KPMG’s “Stella Report,” commissioned by Philip Morris International, reveals.

In the crisis years, overtaxation turned citizens to the consumption of illegal products, obtained both directly from farmers as well as on the black market, with clear risks for public health. The increase in taxation on tobacco led thousands of smokers to switch to contraband cigarettes.

The report showed that the illegal cigarette market in Greece soared to 23.6 percent last year, up 5.6 percentage points from 2017, while it was in this country that the biggest quantity of contraband cigarettes in the EU was recorded, amounting to 1.5 billion euros. In the EU the average rate of illegal tobacco came to 8.6 percent of all tobacco consumed.

Today taxation makes up 85 percent of the retail price of cigarettes in Greece, which is an obvious incentive for smuggling: When a smoker pays 4.50 euros for a pack of cigarettes, 3.85 euros goes to the state and just 0.85 euros to the retailer, the distributor and the tobacco industry.