On April 28th, Vladislav Zaslavsky, acting director of the Department of Digital Commodity Identification Systems at the Russian Ministry of Industry and Trade, announced that the losses caused by illegal tobacco transactions in Russia in 2022 amounted to 81.5 billion rubles.
He made this statement during a roundtable aimed at combating the illegal trade of tobacco and nicotine products. These figures are estimated by the National Scientific Center for the Suppression of Illicit Industrial Products (ANONNCCK).
According to the largest estimate, this number exceeds 100 billion rubles.
Zaslawski also stated that, according to ANONNCCK's data, the proportion of illegal cigarettes among smokers in 2022 is 12.2%.
He stated, "By the end of 2022, the market share of illegal nicotine products had reached 79%, with illegal e-liquid accounting for 93% of that. This further adds to the estimated national loss of 3 billion rubles.
According to him, this market is expected to undergo fundamental changes with the implementation of specialized legal regulations for tobacco and nicotine products. The bill is currently going through its second reading in the national parliament.
He reminded that the bill provides for a mandatory licensing system for the production and import of tobacco, nicotine products and raw materials. Manufacturers must register the main equipment used to produce their products and take other measures to clean up the market.
The proposed bill suggests transferring the authority to regulate the tobacco market from the Ministry of Agriculture to the Ministry of Finance, and restructuring the Russian alcohol regulatory agency to create a federal agency responsible for monitoring the alcohol and tobacco markets, known as the Russian Alcohol and Tobacco Control Authority.
According to the participants of the roundtable discussion, the spread of illegal products was partly due to the suspension of commercial inspections.
In this scenario, Zaslawski believes there should be a shift towards risk-based regulation.
A marking system that provides product traceability (honest labeling) could become the foundation of a risk management system. It is now necessary to align regulatory frameworks with the data used in the system in order to achieve regulatory oversight.
He said that 11 indicators have been developed to identify potential violations in the tobacco market.
According to data from the Russian Statistics Agency, cigarette production in Russia decreased by 7% in 2022 compared to the previous year, with a total of 22.2 billion cigarettes produced.
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Reference:
The Ministry of Industry and Trade estimates that the illegal tobacco trade will cause a loss of 81.5 billion rubles to the budget in 2022.
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