In Ukraine, the volumes of illegal trade in tobacco products are showing rapid growth. In April 2025, the share of the shadow cigarette market reached a record 16.2%, which is 2.1 percentage points higher than at the beginning of the year, when this figure was 14.1%.
This is reported by Finway
Losses for the Budget and Structure of the Shadow Market
According to experts, due to tax evasion resulting from the illegal circulation of tobacco products, the state budget of Ukraine will lose 25.2 billion UAH in 2025. The total volume of the shadow cigarette market exceeded 5 billion pieces. The share of counterfeit products has also significantly increased – to 8.8% in April this year compared to 6.4% in February. A significant portion of the illegal products consists of cigarettes labeled Duty Free or intended for export, which illegally enter the domestic market.
Main Players and Regional Features
Production of more than half of the illegal tobacco products, according to packaging markings, is carried out by the Vynnyky Tobacco Factory. The largest market shares are held by the brands Compliment (47%) and Lifa (5%). The remaining 43% of illegal products belong to the brands of the manufacturer Marshall Finest Tobacco: Marshall (26%), Urta (9%), and Brut (3%).
The largest volumes of illegal cigarette sales are recorded in six regions, which together account for 71% of the shadow market. Dnipropetrovsk region leads (27%), followed by Odesa (13%), Lviv (10%), Kharkiv (9%), Kyiv and Kyiv region (7%), and Khmelnytskyi (6%). The main sales channel remains kiosks and stores, through which 67% of illegal tobacco products were sold in April.
According to Natalia Fesiun, the General Director of the “Ukrtyutyun” Association, over three and a half years of full-scale war, the state has lost nearly 90 billion UAH in taxes due to illegal trade in tobacco products. This money could have been directed towards the country’s defense capabilities.
The total budget losses over three and a half years of war caused by the shadow circulation of tobacco products amounted to about 90 billion UAH.
Journalism Award to Combat Illegal Trade
To raise awareness of the issue and stimulate efforts against illegal trade, the third All-Ukrainian journalism award, the ContrafACTS Media Awards, has been launched. Experience from previous years has shown that professional media coverage creates a powerful public resonance and encourages law enforcement agencies to take more active action.
Journalists from various media and digital content creators are invited to participate. Materials must be prepared between July 1 and September 30, 2025. The prize fund of the competition is as follows:
- 1st place – 70,000 UAH;
- 2nd place – 35,000 UAH;
- 3rd place – 25,000 UAH;
- special awards from the jury – 20,000 UAH each.
Each participant whose material is accepted for participation is guaranteed to receive a prize of 2,000 UAH.
Among the partners of the competition are the European Business Association, the Kyiv organization of the National Union of Journalists of Ukraine, the Interfax-Ukraine agency, and the business publication The Page.