The tobacco black market is growing super-fast

FTI Consulting have done their annual report on what proportion of tobacco in NZ comes from the black market. They use both a survey of users, and also a survey of empty packs to get scientifically robust estimates.

Their key findings are:

• 27% of tobacco is now black market
• Contraband tobacco has increased 41% since 2023
• The black market has resulted in $600 million less revenue for the Government
• Last year legal tobacco sales dropped 6.7% and illegal sales increased 13%

Again this is a very useful reminder that if you increase taxation on a product too high, you turbocharge the black market.