12 - Illicit Tobacco trade in Switzerland

The issue of the tobacco “black market” is regularly raised in Switzerland as a warning against increasing taxes on tobacco and nicotine products. According to this argument, higher taxes would automatically lead to more smuggling, an expansion of illicit trade and a loss of tax revenue for the Confederation. This report examines that claim using data available in Switzerland, statistics from the Federal Office for Customs and Border Security (FOCBS), estimates produced by KPMG for Philip Morris International, Empty Pack Surveys and the Federal Council’s report of December 2025.

The main conclusion is straightforward: Switzerland currently lacks the data needed to measure reliably the true scale of illicit tobacco trade within its borders. Customs offences and smuggling operations do occur, but the available official data do not provide a consistent body of evidence demonstrating the existence of a large, structured underground market supplying a substantial share of tobacco consumed in Switzerland. The FOCBS itself acknowledges that its statistics do not allow products, types of offence, actual seizure dates or the final destination of goods to be distinguished precisely.