On June 3, 2024, AmCham Ukraine held the round table discussion regarding the issue of the illegal market of solid excisable goods with representatives of the Embassies of the USA, Italy, Japan, and the Delegation of the European Union to Ukraine, as well as Parliament and Government officials and business representatives. The event was devoted to the discussion of further steps to combat the shadow market of excisable goods and the establishment of effective coordinated work of all involved state authorities to help reduce losses of the State Budget of Ukraine.
In 2022-2023, during Russia's full-scale war against Ukraine, due to the activities of the shadow sector, the State Budget under received more than UAH 42.5 billion in tax revenues, and the size of the shadow market continued to grow.
According to the results of the latest KANTAR Ukraine study as of March 2024, the share of the illegal market of industrial cigarettes in Ukraine decreased by 6.6% and amounted to 19.1% of the total market.
At the same time, regardless of the current decrease in the level of the illegal tobacco market, the preliminary assessment of unpaid taxes to the budget of Ukraine reached a new record of 24 billion UAH in 2024, considering the increase in the excise tax rate from January 1, 2024.
We are grateful to Member of Parliament Danylo Hetmantsev for his leadership in combating the illicit tobacco market, as well as Members of Parliament Yaroslav Zheleznyak and Halyna Yanchenko for their active involvement and support. We also thank the Economic Security Bureau of Ukraine, the Prosecutor General’s Office, and all involved law enforcement and other state authorities for their efforts. There is a clear correlation between the decline in the illegal tobacco market and the active work of law enforcement agencies.
The Economic Security Bureau of Ukraine recently released official publications providing information about numerous searches of enterprises that allegedly use illegal schemes to evade taxation. At the same time, it is important to ensure that all necessary legal steps are taken after the searches to suppress any further illegal activities by such enterprises and to prevent them from resuming such activities in the future.
AmCham Ukraine member companies of the Solid Excisable Goods Task Force took part at the round table. They are consistently among the top largest taxpayers in Ukraine – BAT Ukraine / B.A.T. – Prylucky Tobacco Company, Imperial Tobacco Ukraine, JTI Ukraine, Philip Morris Ukraine and paid 106 billion UAH worth of taxes overall in 2023.
The event was also attended by:
- Representatives of the Embassies of the USA, Italy, Japan, the Delegation of the European Union to Ukraine
- Danylo Hetmantsev, Member of Parliament, Chairman of the Parliamentary Committee on Financial Issues, Tax and Customs Policy
- Yaroslav Zheleznyak, Member of Parliament, First Deputy Chairman of the Parliamentary Committee on Financial Issues, Tax and Customs Policy
- Halyna Yanchenko, Member of Parliament, Chairman of the Temporary Special Commission of the Verkhovna Rada of Ukraine on Protection of Investors’ Rights
- Oleksandr Tkachuk, Head of the main unit of detectives of the Economic Security Bureau of Ukraine
- Oleksandr Tarkan, Head of the Department for Supervision of Compliance with Laws by the Economic Security Bureau of Ukraine, Prosecutor General’s Office
- Ivan Vyhivskyy, Head of the National Police of Ukraine
- Ivan Pysarchuk, Head of the Strategic Investigations Department of the National Police of Ukraine
- Yevhen Dorohanov, Deputy Head of the Operational Response Department of the Cyber Police Department of the National Police of Ukraine
- Mykola Hrintsov, Director of the Department of Interaction with the National Police of Ukraine of the Ministry of Internal Affairs of Ukraine
- Yevhen Sokur, Acting Deputy Head of the State Tax Service of Ukraine
- Oleksiy Kalynovych, Deputy Director of the Department for Combating Smuggling and Customs Violations of the State Customs Service of Ukraine
- Oleh Hetman, Expert Groups Coordinator of the Economic Expert Platform
