EU-ABC: PH loses ₱141B to illicit tobacco trade in two years

By Monsi A. Serrano and Andrea B. Ramos

The EU-ASEAN Business Council (EU-ABC) and market research firm Euromonitor International said the Philippines lost an estimated ₱141B (US$2.5 billion) in government revenues to illicit tobacco trade over the past two years, based on a regional study tracking illegal cigarette and e-vape sales, tax leakages, and supply chain movements.

The report found that the Philippines has the highest illicit e-vape incidence among assessed ASEAN countries where vaping products are legal, with 86% of e-vapes sold locally classified as illicit. Illegal e-vape sales alone resulted in an estimated ₱23B in lost government revenues from 2024 to 2025.

EU-ASEAN Business Council Executive Director Chris Humphrey and Euromonitor International’s Firdaus Muhamad address the media during a briefing on illicit tobacco trade in ASEAN. (PHOTO BY THEPHILBIZNEWS/Monsi A. Serrano)

According to the study, illicit tobacco products continue to proliferate due to lower prices, easier online access, weak supply chain controls, and porous regional trade routes that allow smugglers to move products across borders with minimal detection.

“The decentralised nature of online sales makes it hard to crack down on illicit tobacco operations,” said Firdaus Muhamad, Head of Consulting for APAC at Euromonitor International.

Euromonitor International and Head of Consulting for APAC Firdaus Muhamad. ((PHOTO BY THEPHILBIZNEWS/Monsi A. Serrano)

“Sellers can quickly shift between platforms, communication channels, and delivery networks to evade detection,” he added.

The report identified the Subic Bay Freeport Zone as among the regional hotspots vulnerable to illicit trade flows, alongside key smuggling and distribution hubs across Southeast Asia.

EU-ASEAN Business Council Executive Director Chris Humphrey speaks with members of the media. (PHOTO BY THEPHILBIZNEWS/Monsi A. Serrano)

EU-ABC Executive Director Chris Humphrey said the growing illicit tobacco trade poses serious economic, public health, and security risks, warning that billions in lost revenues could have been used for infrastructure, healthcare, education, and other public services.

He stressed the need for stronger regional coordination among ASEAN member-states, saying illicit trade has evolved into a cross-border problem that requires collective enforcement, intelligence-sharing, and tighter customs cooperation.

The report noted that the broader ASEAN-6 region lost an estimated US$13.1B in government revenues from illicit tobacco trade over the past two years, with Indonesia posting the highest losses at US$5.6B, followed by Malaysia and the Philippines at US$2.5B each.