A survey has shown that Croatia lost HRK 1.3 billion (EUR 173 million) in budget revenues in 2021 because of illegal trade in cigarettes and tobacco, reports Total Croatia News.

The survey by the Croatian Employers' Association (HUP) and Ipsos market research agency aimed to find out how big the market of untaxed tobacco actually is and what impact it has on the country’s economy. From December 2021 to January 2022, a representative sample of 3,062 respondents aged 19 and over were questioned with results showing that 27.9 per cent smoked a number that has remained stable despite rising prices, reports Total Croatia News.
"According to the survey, the share of untaxed tobacco products is 19% on an annual level and this mostly accounts for untaxed cut tobacco," HUP chief economist Iva Tomić said.
In 2021, revenues from excise tax and VAT on tobacco products was around HRK 8 billion (EUR 1 billion), which amounts to 8 per cent of total tax revenues, according to Total Croatia News.
Tomić said the state was introducing tracing systems and limiting the import of tobacco products from non-EU countries to two packs per person in an attempt to clamp down on the illegal trade.
"A good regulatory and tax environment is crucial for business stability and is in the interest of all tobacco market participants," he said.