How Russia’s main ally Belarus makes tens of millions smuggling tobacco into UK
Illicit tobacco from Belarus likely to be worth tens of millions of pounds is being smuggled into Britain amid growing evidence that smuggled cigarettes are being used to enrich the East European country’s corrupt dictatorship.
Official government trade figures show that Britain imported “beverages and tobacco” from Belarus worth nearly £162m last year despite sanctions banning most trade with the country due to its support for Russia’s invasion of Ukraine.
It has been established by i that this figure includes an estimate for the value of contraband cigarettes and other tobacco illegally smuggled into Britain from the east European country, whose authoritarian leader Alexander Lukashenko is one of Vladimir Putin’s most steadfast allies.
Both the Department for Business and Trade and the Office for National Statistics, which compiles trade figures, declined to reveal the share of the £162m made up by illicit tobacco. But given that nearly all legal imports into the UK of tobacco and alcohol from Belarus are currently banned, it appears that a significant proportion of the goods included in the official data is contraband and is costing the taxpayer millions in lost excise.
One trade and customs expert told i: “Belarus has a long-established record as a source of illicit or illegal tobacco. The Ukraine war has made it more difficult for that material to reach Europe and the UK but it is still getting through in considerable quantity.”
Illicit tobacco, which enters Britain and other countries hidden on trucks and cargo containers carrying otherwise legitimate consignments, is sold without paying excise duty. According to HM Revenue & Customs, the UK loses some £2.8bn a year in taxes evaded by smuggled tobacco.
The black market trade also poses a risk to human health beyond the known risks of smoking because it includes fake or counterfeit cigarettes which have been found to contain high levels of toxic metals such as mercury and lead, as well as traces of substances including weedkiller and animal faeces.
Campaigners for democracy in Belarus, where Lukashenko launched a brutal crackdown in 2020 after refusing to accept defeat in presidential elections, said they were “appalled” by the extent of illegal tobacco reaching Britain, saying the criminal trade was “filling the coffers” of a repressive regime.
According to monthly UK government trade figures, Britain imported “beverages and tobacco” from Belarus worth £161.6m in the 12 months to last June – a figure which represents some 96 per cent of all Belarusian goods reaching these shores.
While the publicly-available data does not provide a further breakdown of the imported goods, the ONS told i that the figure includes “estimates of smuggled tobacco”. In a statement, the ONS added: “Belarus is a key source of illicit tobacco.”
The data suggests that the war in Ukraine, which has closed border crossings between Belarus and Lithuania and Latvia – a key conduit for tobacco smuggling into western Europe, has put a dent in the amount of contraband reaching Britain. Previous estimates for the amount of Belarusian “beverages and tobacco” imported to the UK last year stood at £451m but the ONS said this had now been revised downwards following the “updating of a data source” tracking tobacco shipments.
Democracy activists said the figures nonetheless highlighted how the Belarusian regime is continuing to profit from tobacco sales despite international efforts to isolate and ostracise the Lukashenko regime.
The Professional Union of Belarusians in Britain, an opposition group, told i: “We are appalled by the extent of the illegal tobacco trade from Belarus to the UK. This trade is costing the UK millions in lost excise and is filling the murderous Belarusian regime’s coffers, allowing it to carry on with repressions locally and to provide continuous support to the Russian aggression in Ukraine.”
Human rights activists and Western governments have repeatedly accused Lukashenko of surrounding himself with cronies including the owners of key industries who are used as “wallets” to fund his family’s coffers and finance repression.
In December, the American authorities imposed sanctions on two Belarusian tobacco magnates – Pavel Topuzidis and Viktor Petrovich – who they said are among the country’s richest oligarchs and act as conduits of wealth for the regime.
The two men own Tabak Invest LLC, which until 2017 was the sole private tobacco producer in Belarus and manufactures around 30 per cent of the country’s total output. Washington cited allegations that the company is linked to an elaborate cigarette smuggling operation targeting Russia which has netted it “millions of dollars in revenues”.
In a statement, the US Department of the Treasury said it believed Topuzidis, a confidant of Lukashenko who has even paid for an ice hockey “palace” in one of the dictator’s personal residences, and Petrovich are “important ‘wallets’” for the Belarusian leader and his regime.
Belarus has long been regarded as one of the world’s biggest sources of smuggled or illicit cigarettes and tobacco goods. In 2021, the Lithuanian customs authority said it estimated that 80 per cent of the 328 million smuggled cigarettes it seized that year originated from Belarus. According to another estimate, around 10 per cent of illicit tobacco reaching Britain comes from Belarus.
According to the most recent figures provided by HM Revenue & Customs, which leads an ongoing £100m campaign to crack down on tobacco smuggling, some 1.35bn illicit cigarettes destined for the UK market – worth some £556m – were seized in the year to March 2022.
A HMRC spokesperson said: “Illicit tobacco undermines legitimate retailers, funds wider crime, and harms public health while depriving the public purse of around £2.8 billion a year. Our updated strategy reinforces HMRC and Border Force’s determination to tackle this organised criminal trade that harms our communities and drive down the demand for these illicit products.”
