“The level of contraband with tobacco products is relatively constant, reaching 13.4% of overall consumption on the Romanian market. Throughout the regions affected by contraband, the numbers haven’t changed: 31% in the western region, 22.2% in the north-east, and 20.8% in the north-west of the country,” Novel Research manager Marian Marcu said in a press release.
Marcu added the numbers for capital Bucharest are worrisome, as contraband here has increased by 5.8 percentage points since March last year, accounting for 13.5% of the market. However, in the south-west region, contraband has dropped 5.1 points since the beginning of the year, to 8%.
The biggest sources for contraband cigarettes are Ukraine, with 27%, followed by the Republic of Moldova with 26.2%, Serbia with 20.8% and duty-free shops with 18.7%.
“Contraband has decreased in two years from over 36% to around 13%, thanks to authorities’ countering efforts, said Gilda Lazar, JTI director of Corporate Affairs & Communications for Romania și Moldova.
Adrian Popa, director of Corporate & Regulatory Affairs with BAT Romania, said contraband in March decreased compared to March last year, when the black market stood art 14.7%.
“We feel the decrease of contraband should have been sharper considering the government listed countering tax evasion and contraband among its top priorities. Right now, 13.4% of the market accounted by contraband translates into a loss of around EUR400 million in unpaid taxes,” said Popa.
Romania needs fiscal stability and predictability, besides countering efforts, for contraband to keep decreasing, said Sorana Mantho, Philip Morris director of Corporate Affairs for Romania and Bulgaria.
The tobacco industry is one of the largest taxpayers in Romania. In 2011, the three tobacco companies contributed around EUR2.75 billion in excises and value added tax.