The European Union is failing to collect data on illegal tobacco trade as uneven country legislation creates gaps where criminal groups can jump in, the European Court of Auditors (ECA) found in a report published Tuesday (8 September).
Illegal tobacco trade makes tobacco products cheaper and more accessible, and costs the EU and its member states over €13bn each year, according to EU Commission estimates.
“That is €13bn that never reaches our schools, hospitals, or other public services. And more alarmingly, we do not have an EU-wide picture of the true size, structure, and economic impact of this illegal market,” Petri Sarvamaa, a member of the ECA, said during a press briefing on Tuesday.
One in ten cigarettes made in the EU is either produced illegally or smuggled, the auditors report. In 2025, the European Anti-Fraud Office (OLAF) helped prevent €178m in lost tax revenue.
But tobacco fraud continues to pose “an ongoing and complex challenge for the EU,” the Commission said in a response to the ECA.
