The Petrol Retailer’ Association (PRA) today expressed concern at the release of HMRC’s Tax Gap report for tobacco, showing that the UK Treasury is losing billions of pounds a year to the illicit market.

Brian Madderson, PRA chairman said: “Today’s report highlights that more needs to be done to tackle the illicit trade in tobacco which costs the UK up to £2.9bn a year.

“The illicit tobacco trade is not a victimless crime. Not only does it deprive the Government of much- needed revenue, it also funds organised crime and undermines public health.

“Reports such as this only further our concerns about the consequences of extreme tobacco regulations which we continue to see implemented across the UK.

“This week the EU voted to ban menthol and 10-packs of cigarettes, and the Scottish Government continues to push ahead with plain packaging. These regulations will only fuel the illicit trade, by making the products easier to copy and by encouraging smokers to seek out their preferred product through alternative channels. The report also highlights that illicit tobacco is readily available - to anyone who wants them, no matter their age."

A survey of PRA members last November showed 62% believed the illicit trade in tobacco products was having a negative impact on their business with 88% believing that if plain packaging was introduced it would make it easier for forgers to produce counterfeit cigarettes.

Madderson continued: “HMRC’s report shows that the issue of illicit tobacco is a very real problem hurting our 5,500 members across the country and our message to Government, both in Westminster and Holyrood, is that further tobacco regulations, such as plain packaging, should be based on evidence and nothing else.”