Ukrainian Budget Loses 30 Billion UAH Annually Due to the Shadow Tobacco Market

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Ukrainian Budget Loses 30 Billion UAH Annually Due to the Shadow Tobacco Market

The implementation of electronic excise stamps is set to be an important step in the fight against the shadow circulation of alcoholic and tobacco products in Ukraine. According to experts’ estimates, the state budget loses about 30 billion UAH each year from the illegal sale of tobacco products alone.

This is reported by Finway

The Problem of the Shadow Market and the Implementation of Electronic Excise Stamps

The Deputy Minister of Digital Transformation, Zoryana Stetsyuk, stated in an interview that research shows significant budget losses specifically due to the shadow segment of the tobacco industry. She noted that the results of studies conducted by Kantar are often used, confirming the overall trends of losses.

“There are actually many studies now, and they vary. For example, we most often use Kantar’s research. According to this research, if we calculate the average, it converges on the fact that the budget loses an average of 30 billion UAH in the tobacco market,” Stetsyuk said.

According to her, this refers to cases where tobacco products are sold outside the legal market, meaning without tax payments and official circulation procedures within Ukraine. The detailed pathways for the distribution of such products remain outside this statistics, but the overall volume of losses is evident.

Electronic Excise Stamp: New Opportunities for Market Control

The electronic excise stamp system is already operating in test mode. It allows for the creation of an electronic stamp for each unit of product. As a result, any consumer using the “Diia” app and scanning the unique code can obtain complete information about the product—from the manufacturer to the point of sale.

The mandatory use of e-Excise is planned to begin on November 1. At the same time, products with paper stamps will be allowed to be sold until mid-2027. The Ministry of Digital Transformation urges all market participants not to delay connecting to the system to have enough time to address potential shortcomings and be ready for a full launch on November 1.

The Parliament of Ukraine has extended the testing of the e-Excise system until October 12, 2026, with a full launch scheduled for the beginning of November 2026. The implementation of this project is carried out through the joint efforts of the Ministry of Digital Transformation, the Ministry of Finance, and the State Tax Service, as well as with the support of international partners, including USAID, UK Dev, the Eastern Europe Foundation, and the Institute of Analytics and Advocacy.