The share of tobacco products from Moldova on the Romanian cigarette black market increased by 7.4 percentage points in May, compared to March, and amounted to 23.3% - Novel Research.
According to data provided by the research company, the cigarette black market in Romania grew again in May, accounting for 10.4% of total cigarette consumption (January - 7.7%, March - 9.8%). This is the highest level of smuggling in Romania since January 2020. According to the study, in May, smuggling increased the most in the North-East of Romania - by 5.2 percentage points – up to 26.5% and in the South-Eastern direction – by 2.6 percentage points – up to 7.4%. As for the origin of products on the black market, the largest share still belongs to Duty Free (more than 36.3%), although it decreased by 5.1 percentage points, compared to March of this year. This is followed by Moldova with a share of 23.3% (+7.4 p.p.) and Bulgaria – with a share of 22.1% (+1.6 p.p.). At the same time, the share of the Cheap Whites segment decreased to 11.5% (-1.2 percentage points). Romanian media report that according to centralized information on the stopcontrabanda.ro platform, since the beginning of the year, Romanian authorities have seized about 34 million smuggled cigarettes, 75% of which are located in the southern part of the country. As noted by BAT's South East Europe Area Head of Corporate and Regulatory Affairs, Ileana Dumitru, for the first time in the last 3 years, the level of smuggling exceeds the threshold of 10% of the total market volume, and illicit trafficking is the most dangerous competitor not only for the legal industry, but also for state budget revenues. The BAT spokeswoman welcomed the installation of scanners at Romanian borders, but believes that these measures should be complemented by a tax framework. Head of Corporate Affairs and Communications of JTI in Romania, Moldova and Bulgaria Gilda Lazar, while commenting on the statistics, noted that prices for cigarettes in Romania, contrary to existing opinion, are higher than, for example, in Luxembourg: a Luxembourger can buy with his disposable income in 4 times more cigarettes after taxes than Romanians. He noted that the continued growth of smuggling after the January increase in excise taxes will be a serious signal for decision makers, and they will stop changing the calendar of tax changes. He also noted that against the background of the growth of the black market, revenues from tobacco excise taxes to the state budget of Romania decreased by 8.3%. “We need financial predictability and legislative stability to be able to increase budget allocations. JTI alone transferred 1.3 billion euros worth of excise taxes, VAT and other taxes to the state last year, which is more than 75% of turnover,” noted a JTI representative. // 01.07.2024 - InfoMarket.
