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Global Challenge of Illicit Tobacco Trade: Economic and Regulatory Implications

Illicit trade in tobacco poses formidable challenges for the industry, with an estimated 10-12% of global cigarette consumption falling into illicit channels, accounting for a staggering 400 – 460 billion cigarettes annually. This shadow market results in annual tax revenue losses ranging from 40 to 50 billion dollars (PMI). Leveraging the physical attributes of tobacco products—lightweight, easily concealable, and non-perishable—the illicit tobacco trade stands as one of the most lucrative criminal enterprises globally.

Combatting illicit tobacco trade demands concerted action from governments, law enforcement agencies, and the tobacco industry alike, necessitating robust measures to stem smuggling, enforce regulations, and safeguard both public safety and economic interests.