Ukraine intensifies crackdown on illicit tobacco and alcohol markets

Key Points Overview

1. The Ukrainian tax authority conducted 24,000 on-site inspections of the tobacco and alcohol market this year, resulting in fines totaling over 795 million hryvnias (approximately 20 million US dollars). 
2. More than 2,500 businesses had their operating licenses revoked for violations, with cracking down on the illegal tobacco and alcohol market becoming a focus of regulation. 
3. The government has implemented a new labeling system for alcohol, tobacco, and e-cigarette liquids to enhance tracking and anti-counterfeiting measures. 
4. The World Health Organization is urging countries to increase tobacco and alcohol taxes by at least 50% by 2035.

2Firsts, October 17, 2025 — Ukraine’s State Tax Service (GNS) has reported major progress in tackling illegal trade in the alcohol and tobacco sectors. Acting Head Lesya Karnaukh said the agency carried out 24,000 on-site inspections this year, uncovering widespread violations that resulted in ₴795 million (US$20 million) in fines and the revocation of more than 2,500 licences.

Speaking at a meeting with representatives of the American Chamber of Commerce in Ukraine, Karnaukh emphasized that combating illicit trade remains a top priority. “These are not minor errors but serious breaches that harm both business and citizens,” she said.

The most common offences include the sale of goods without excise tax stamps or with counterfeit ones, unlicensed production, sales without issuing receipts, and unregistered inventory. GNS continues to coordinate with law enforcement to reduce the shadow market.

The government has also approved a new framework for the labelling of alcohol, tobacco, and e-liquid products, replacing earlier decrees. Meanwhile, the World Health Organization (WHO) has called on countries to raise taxes on tobacco, alcohol, and sugary beverages by at least 50% by 2035 to protect public health.

Image source: Dengi.ua