The number of illegal cigarettes in Ukraine in 2025 may reach 5 billion pieces, and the amount of unpaid taxes to the state budget - 24.2 billion hryvnias. Such figures cites Economic Pravda in its special project, according to Dengi.ua .
This amount could be used to buy about 400,000 FPV drones or build 12,000 apartments for families who lost their homes because of the war. In general, Ukraine loses from 17 to 31 billion hryvnias of excise tax annually due to the illegal tobacco market.
Also, after a long decline in the share of the illegal tobacco market from 21.8% in 2023 to 16.1% in 2024, in February 2025 again recorded growth: the figure reached 14.1%. The most common tax evasion schemes are trade in counterfeit tobacco products, as well as products intended for sale for export or in duty-free zones (labeled Duty Free).
In particular, in February 2025, the share of illegal tobacco products labeled Duty Free reached 6.4%, while in 2024 the annual average was 5.9%. It is noted that more than half of such products (55%) in early 2025 produced by "Vinnikivska Tobacco Factory". The main trademarks of this company are Compliment (50%) and Lifa (5%). The producers of the remaining 45% of illegal cigarettes are still unknown, but common brands are Marshall (25%), Ultra (9%) and Brut (6%).
The share of counterfeit tobacco reached 7% in February 2025, with an annual average of 8.3% in 2024. The main counterfeit producers are Marshall Finest Tobacco, United Tobacco, and VK Tobacco FZE, which account for 25% of counterfeits without excise stamps. Another 8% of the market is occupied by "Ukrainian Tobacco Production".
At the same time, the share of smuggled supplies is decreasing - from 2.9% in November 2021 to 0.6% in February 2025. The main distribution channels for illegal cigarette products in 2025 are stores and kiosks. This negative trend has continued since last year. In particular, stores account for 29% of sales, while kiosks account for 39%. In addition, 14% of illegal cigarette sales belong to street vendors and 11% to open markets.
At the same time, 73% of the illegal cigarette market in Ukraine is formed by the following regions: Dnipropetrovsk region (28%), Odesa region (16%), Lviv region (9%), Kharkiv region (8%), Kyiv and Kyiv region (7%), Khmelnytsky region (5%).
