TAE Analysis of the Euromonitor International Report 2026

“Counterfeit Cigarette Manufacturing and Consumption in Europe”

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

• Tobacco tax increases 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 illegal cigarette production and consumption.
• Tax revenue shortfalls of €19.4 billion in 2024 alone.
  à Counterfeit cigarettes account for €4.23 billion of this,
  representing     a 75% increase on the previous year.
• Five countries – France, Hungary, the Czech Republic, Romania and the Netherlands – are responsible 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 “Made in the EU” approach promoted by the EU 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 push 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 increase in tax revenue is seriously mistaken! Because if prices – i.e. costs – become too high for consumers, then the shift to and consumption in the illegal market rises in equal measure.

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

One can only warn against unbalanced, excessive tax increases!

Download the full version of the TAE report

Link to the Euromonitor International report 2026

Brussels/Munich, April 15, 2026