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ITIC warns on growing illicit tobacco trade

29 May 2011. The International Tax and Investment Center (ITIC) on Friday warned policy makers of the European Union about the growing prevalence and the dangers of illicit trade in tobacco products.

At a meeting on intellectual property, counterfeiting and piracy in Brussels, ITIC stated that the EU faces an uphill battle to stem the flow of illegal cigarettes pouring through its borders and across its member states.

Daniel Witt, President of ITIC, called on policy makers to assess any potential impact on aggravating illicit trade that measures such as the introduction of plain packaging for cigarettes may have.

ITIC said that illegal cigarettes account for approximately 9 per cent of all cigarettes consumed across the EU, costing governments an estimated EUR 10 billion in lost tax revenues each year, but stressed that the consequences of illicit trade reach far beyond government revenue loss. "Criminal gangs attracted by the huge profits are selling completely unregulated tobacco products to anybody who will buy them, including kids," said Witt.

ITIC, which is an independent nonprofit research and education foundation based in Washington D.C., pointed to numerous factors that are contributing to illicit trade, highlighting unbalanced fiscal policies, protectionist policy measures and weak enforcement. It has recently launched a booklet - The Illicit Trade in Tobacco Products and How to Tackle It - which outlines the scope and drivers of illicit trade.

The meeting in Brussels was hosted by the European Parliament's Kangaroo Group, an association of members of the European Parliament, Commission and Council and representatives of industry and academia who work to enhance European unity under motto free movement and security. (pi)


You can read more about ITIC and its brochure here.