Kazakhstan’s state budget lost approximately 33 billion tenge last year due to cigarette smuggling. Meanwhile, the number of tobacco users in the country is growing every year.
According to ORDA, citing a survey by the Bureau of National Statistics, nearly 20% of the country’s adult population consumes tobacco products. It was also revealed that spending on cigarettes accounts for an average of 3% of all expenditure on consumer goods.
“Tobacco companies are among Kazakhstan’s largest taxpayers; this sector is second only to the oil industry. On average, in recent years, Kazakhstan has seen growth in the cigarette market. Despite this steady growth, cigarette smuggling means the Kazakh budget is losing out on tens of billions of tenge,” the statement reads.
According to the Association of National Investors, excise tax collection last year amounted to 281 billion tenge, which is 2.6% more than in 2022. At the same time, the excise tax rate rose by 14.6%. Experts concluded that last year, losses from counterfeit tobacco amounted to approximately 33 billion tenge.
“Interesting statistics are shown by the foreign trade of Kyrgyzstan, which is in the EAEU. According to the UN Comtrade database, in 2022 the UAE declared cigarette exports to Kyrgyzstan worth $177.8 million. However, for the same year, Kyrgyzstan officially reported importing cigarettes from the UAE worth only $1.4 million,” reported ORDA.
Furthermore, it emerged that the most popular brands of smuggled cigarettes brought into Kazakhstan were produced in the UAE. Journalists did not rule out that “cigarettes continue to enter the country illegally — via neighbouring countries — and taxes go not into the treasury, but into the shadow economy.”
It was previously reported that in Uralsk, a large consignment of more than 1.6 million packs of cigarettes was seized. It was valued at over 967.5 million tenge.
It was also reported that the AFM department for the Zhetysu region investigated a criminal case concerning an attempt to import two train carriages of tobacco products worth more than 1.3 billion tenge from the Kyrgyz Republic without excise stamps or accompanying shipping documents.