TAE analysis of the Euromonitor International report 2026

“The production and consumption of counterfeit cigarettes in Europe”

The Euromonitor International Report 2026 presents alarming figures that should prompt the European Commission and national governments to rethink their approach:

  • Increases in tobacco taxes do not necessarily lead to additional revenue;
    on the contrary: the black market – smuggling and illegal production – is booming.
  • The EU has become a global epicentre for the illegal production and consumption of cigarettes.
  • In 2024 alone, tax losses of €19.4 billion are expected.
    Of this, €4.23 billion is attributable to counterfeit cigarettes,
    representing a 75% increase on the previous year.
  • Five countries – France, Hungary, the Czech Republic, Romania and the Netherlands – account for 68.5% of the total growth in counterfeit cigarettes between 2015 and 2024.
  • Smuggling is increasingly being replaced by illegal production within the EU.

The findings suggest that the EU’s ‘Made in the EU’ approach is increasingly being replaced by ‘Fake it in the EU’.

According to the report, this trend is driven by sharp increases in excise duties, product bans and restrictions on legal alternatives, which widen the price and affordability gap between legal and illegal products and drive price-sensitive consumers in particular towards illegal distribution channels.

So anyone who believes that an increase in excise duties leads to a linear 1:1 rise in tax revenue is sorely mistaken! For when prices – i.e. costs – become too high for consumers, the shift towards the black market increases, as does consumption there.

Conclusion: Excise duties on luxury goods such as tobacco, sugar or alcohol are not suitable as reliable own resources for the EU. They do not provide a stable basis for the budget, either at EU level or at national level.

One can only warn against unbalanced and excessive tax increases!

Download the full version of the TAE report.

Link to the Euromonitor International report 2026

Brussels/Munich, 15 April 2026