- 1 How much money does Ukraine lose through schemes related to the illegal circulation of tobacco and alcohol?
- 2 What is the main disadvantage of paper excise taxes?
- class> 3 How does the Ukrainian e-Excise differ from the European system?
- 4 Will Ukrainians be able to check alcohol and cigarettes on their own?
- 5 How many billions of hryvnias can be returned to the budget through the de-shadowing of the tobacco and alcohol market?
- 1 How much money does Ukraine lose through schemes related to the illegal circulation of tobacco and alcohol?
- 2 What is the main disadvantage of paper excise taxes?
- 3 How does the Ukrainian e-Excise differ from the European system?
- 4 Will Ukrainians be able to check alcohol and cigarettes on their own?
- 5 How many billions of hryvnias can be returned to the budget through the de-shadowing of the tobacco and alcohol market?
According to various estimates, the Ukrainian budget loses approximately 30 billion hryvnias annually due to the shadow market for excisable products. Only the cigarette market demonstrates a significant level of illegal circulation, and the situation with alcohol is no better.
In response to the scale of the problem, the government has launched a reform of the excisable goods market and the introduction of the electronic eExcise system. It is intended to change the rules for the circulation of alcohol and tobacco in Ukraine and strengthen control over the shadow segment.
Back in the fall of 2025, the Ministry of Digital Transformation of Ukraine reported that the system was in the final stage of development, and testing of its full functionality had already begun.
24 Channel found out what part of the tobacco and alcohol market is in the shadows, how the new system can reduce the illegal market, and how the problems will be solved.
How much money does Ukraine lose through schemes related to the illegal circulation of tobacco and alcohol?
Back in 2023, in a report by the auditing company KPMG, Ukraine ranked second in Europe's anti-rating in terms of the level of illegal cigarette trade, second only to France, UNIAN reports. Thus, in 2022, the level of illegal cigarette trade was estimated at almost 20%, and budget losses were estimated at 636 million euros.
However, a study by the marketing data and analytics company Kantar Ukraine, published in October 2025, showed that in Ukraine, 17.8% of the regular cigarette market is still in the shadows. The shadow market itself amounts to 5 billion cigarettes.
Interestingly! 37% of such products are cigarettes, the main manufacturers of which are “Marshall Finest Tobacco” (United Tobacco)/VK Tobacco FZE. And among illegal products, which are marked as Duty Free or those intended for export, 57% are produced by the Vynnyky Tobacco Factory.
As for alcohol, data for 11 months of 2025 showed that the budget received only a little more than 0.1 billion hryvnia from producers of alcoholic beverages, in particular, through the influence of increased excise rates, more than 0.9 billion hryvnia was paid, reported Danylo Hetmantsev, Chairman of the Tax Committee of the Verkhovna Rada.
In particular, in late February 2026, law enforcement officers uncovered an organized network, according to the Bureau of Economic Security, that produced alcohol without licenses and excise taxes, using industrial quantities of raw materials. Approximately 50 tons of alcohol used as raw materials, as well as 3 tons of finished products, were seized. And this is just one example.
Deputy Minister of Digital Transformation Zoryana Stetsyuk confirms to Channel 24 that losses due to the illegal tobacco market, based on data from early 2026, were estimated at up to 30 billion hryvnias, and due to the shadow alcohol market – billions more hryvnias every year.
Zoryana Stetsyuk,
Deputy Minister of Digital Transformation
These are large amounts of money that should be used for the state, not for the illegal sector.
In particular, Ms. Zoryana cites data from the CASE Ukraine study, which notes that due to the shadow alcohol market, the budget received less: 11.84 billion hryvnias in 2022, and shadow consumption is 34-36%.
What is the main disadvantage of paper excise taxes?
Therefore, the key tool in combating the illegal market should be the electronic eExcise system, the logic of which is to make each unit of goods visible to the state and significantly narrow the space for shadow schemes.
- Instead of a paper excise stamp, each pack of cigarettes or bottle of alcohol will have a unique digital DataMatrix code, notes Stetsyuk.
- Further, the movement of goods is recorded in the system – from the manufacturer or importer to sale. This means that it is easier for the state to see the circulation of products, businesses to operate in more transparent conditions, and consumers to check the goods through Diya.
The fact is that the reform involves a gradual abandonment of paper excise stamps. Previously, the excise stamp itself did not provide a complete picture of the origin or movement of products. Now the code will actually become the key to the digital history of the product.
A paper stamp does not provide full traceability of the goods and does not provide the state with operational data on their movement. In addition, it can be counterfeited, which creates space for illegal circulation,
– says the Deputy Minister of Digital Transformation.
It is currently known that the reform will primarily concern alcohol and tobacco products, as the problem of the shadow market is one of the largest in these categories.
As for the extension of the system to other excisable goods, this will depend on further decisions of the state. At the same time, the main task now is to qualitatively implement the system precisely in those areas where it can have the greatest effect, noted Ms. Zoryana.
How does the Ukrainian e-Excise tax differ from the European system?
Back in the fall of 2025, it became known that the eExcise system would move to the testing stage of full functionality, and from January 2026, it was planned to introduce the ability to work with the system in offline mode.
The team has already developed the key functionality of the system, conducted a series of training webinars for businesses, and is conducting market testing. It is important that offline solutions were also developed in parallel, meaning the system is designed taking into account real working conditions in Ukraine.
– said Zoryana Stetsyuk.
According to the Deputy Minister of Digital Transformation, in February 2026 alone, the system has already processed about 2 million transactions: almost 2 million unique identifiers were ordered and more than 21 thousand electronic stamps were activated.
Against the backdrop of such results, she also called on representatives of small and medium-sized businesses to join the testing of the system.
Separately, the Ministry adds that eExcise was created taking into account the experience of the European Tobacco Track&Trace system, however, the Ukrainian system still has much broader functionality.
In simple terms, the advantage is that it is not just a tracking tool, but a comprehensive digital system: from an electronic mark and recording the movement of goods to controlling tax payments and checking goods through the Action and interacting with the consumer,
– explains Stetsyuk.
In addition, the Ukrainian model covers not only tobacco products, but also alcoholic beverages, and also takes into account the possibility of working offline, which is especially important in Ukrainian realities.
Will Ukrainians be able to check alcohol and cigarettes on their own?
Stetsyuk says that the logic of the system is as follows: the manufacturer or importer applies an electronic excise stamp with a unique DataMatrix code to each pack of cigarettes or bottle of alcohol. Then, each key transaction with the product is recorded in the system, where it can be tracked.
In essence, business is moving from working with a paper stamp to working with an electronic stamp and digital recording of transactions. This is why a testing phase is needed so that manufacturers, importers and other market participants can work out the process before full launch and configure their systems to work with eExcise,
– the deputy adds.
At the same time, the system should bring practical benefits to entrepreneurs. First of all, it is about fairer competition in the market, because it will be much more difficult for the shadow segment to operate outside of state control.
We remind you!
– It only recently became known that prosecutors from the Prosecutor General's Office, together with detectives from the Bureau of Economic Security of Ukraine, uncovered a scheme to illegally import alcohol of famous brands into the Ukrainian market. The participants in the scheme used connections in diplomatic institutions of foreign countries to register alcohol as cargo for official use, which was not subject to taxation. In this way, products worth more than 4 million hryvnias were imported into Ukraine.
– Instead, in March of this year, the Bureau of Economic Security managed to uncover the largest underground tobacco factory in its entire history. The head of the BEB, Oleksandr Tsyvinsky, released a video of the searches. It was noted that the factory produced 10 thousand cigarettes per minute and 720 thousand packs daily. It is known that the income was 1 billion hryvnia per month.
In addition, less paper bureaucracy, simplified reporting, automation of stamp ordering processes, and better protection of brands against counterfeiting are expected.
At the same time, one of the key features of the system will be that the buyer will be able to check the legality of the product by scanning the code through Diya.
If there is no information or the data does not match, it will be possible to report this. That is, for the first time, the consumer receives a real control tool simply in his smartphone,
– concludes Ms. Zoryana.
How many billions of hryvnias can be returned to the budget through de-shadowing of the tobacco and alcohol market?
It is known that the full launch of the eExcise system is scheduled for November 1, 2026. However, the logic of the launch itself is gradual: testing with businesses is currently underway, an additional test environment with test data is expected to be launched in August, and in October, before the full launch, user registration will be opened.
The state also expects a significant economic effect from the implementation of the system. First of all, it is about reducing budget losses.
We can already see the scale of the problem – over 30 billion hryvnia in losses. Accordingly, the economic effect of e-Excise will be measured by what part of these losses the state will be able to recover thanks to more transparent circulation,
– adds Stetsyuk.
According to her, the latest research by Kantar Ukraine shows that almost every 6th pack of cigarettes on the domestic market is illegal. And due to non-payment of taxes, state budget losses may reach approximately $28.1 billion.
At the same time, e-Excise is viewed not only as a domestic reform, but also as part of Ukraine's European integration obligations.
In general, the system is being implemented by state bodies – the Ministry of Digital Transformation of Ukraine, the Ministry of Finance, and the State Tax Service – with the participation of a specialized committee of the Verkhovna Rada. The reform is also supported by international partners, such as the governments of the United Kingdom and Switzerland.