Ctg's contraband cigarette trade causes Tk4,000cr annual revenue loss

Highlight:

• Chattogram has become Bangladesh's hub for illegal cigarettes

• Cheap unapproved brands flood markets due to weak monitoring

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• Smuggling, false declarations, and counterfeit production drive the trade

• Illegal cigarettes cause major revenue loss and health risks

• Authorities report frequent seizures but trafficking remains widespread

• Demand grows as suppliers deliver cheap illicit cigarettes nationwide

Chattogram has emerged as the central hub of the country's illegal cigarette network. A visit to Dovashi Bazar in the port city's Anwara Upazila revealed that various cigarette brands are being openly sold without approval.

Shelves in the shops are stacked with T20, Marble, Purabi, Express, Marble, and Osaka cigarettes – sold for just Tk45 to Tk55 per pack, far below the government-set minimum retail price.

According to shopkeepers, each empty cigarette pack returned to suppliers yields a Tk5 cashback, a tactic that has sharply increased demand among retailers.

Locals say the cigarettes have become easily accessible due to the lack of administrative monitoring and that the trade has now gone beyond control.

Taking advantage of Chattogram's strategic location – with its seaport, airport, and proximity to border areas – unscrupulous traders have built a vast network involving illegal imports, smuggling, and the production of counterfeit cigarettes.

Large volumes of cigarettes are distributed daily across Bangladesh from Chattogram's Reazuddin Bazar, Khatunganj, Chawk Bazar, and Lalkhan Bazar to both wholesale and retail markets.

A recent study by private market research firm Insight Metrics found that around 13.1% of the national cigarette market is supplied through illegal channels – a 31% rise from last year. Approximately 832 million sticks of illegal cigarettes enter the market every month, causing legal brands to lose sales and the government to lose nearly Tk4,000 crore in revenue annually.

Locally manufactured counterfeit cigarettes are also increasing. Producers are reusing tax stamps by removing them from legitimate packs and attaching them to illicit products, allowing them to sell illegal cigarettes disguised as legal ones without paying any taxes.

Experts warn that the illegal trade not only reduces government revenue but also poses a serious public health risk, as the low-priced cigarettes are more accessible to young and low-income consumers.

Infograph: TBS

False declarations and hidden smuggling routes

Further inquiry shows that cigarettes worth crores are being imported through Chattogram Port under the guise of cosmetics, plastic products, furniture, and even oranges.

Fake cigarette factories have been found in Moheshkhali, Anwara, Raozan, and different parts of the city, where used tax bands are reapplied and counterfeit cigarettes are produced. Reazuddin Bazar, in particular, has become the main transit hub for the illegal trade, with bulk consignments being shipped daily to different parts of the country.

Illegal cigarette traders in Chattogram are using many tactics, including cashback offers for retailers, cheaper prices, and counterfeit packaging to dominate the market — prompting many consumers to turn to the cheaper illegal alternatives instead of legal brands.

A worker at a cigarette shop in Reazuddin Bazar, speaking on condition of anonymity, said, "These cigarettes are brought into the country illegally through sea routes and airports. From Reazuddin Bazar and Khatunganj, they spread across the country."

A retailer in the city's Number 2 Gate area added that demand for foreign brands has soared compared to local ones. When asked how these cigarettes reach his shop, he said, "There are specific suppliers — just one phone call, and they deliver. Additionally, they are easily available in the wholesale shops in Reazuddin Bazar."

What the authorities say

Chattogram Additional District Magistrate (ADM) Syed Mahbubul Haque told TBS, "Illegal cigarettes are not only causing huge revenue losses but also pose serious health hazards since they undergo no quality control. We will notify the VAT and customs authorities about the matter."

Chattogram Customs Deputy Commissioner Md Tarek Mahmud said, "A large number of containers arrive at the port every day. Some dishonest traders try to exploit this by importing illegal goods under false declarations. Major operations have already seized substantial amounts of illegal cigarettes."

"Officials have been alerted, and VAT, customs, and intelligence agencies have been instructed to strengthen monitoring at the local level," he added.

Saifur Rahman, joint director of the Customs Intelligence and Investigation Directorate's (CIID) Chattogram office, said, "We are conducting operations in all locations based on the information we have."

Despite efforts by authorities, illegal cigarettes worth crores of taka continue to enter the country through Chattogram. In recent years, several raids have uncovered evidence of massive tax evasion and the involvement of international smuggling networks.

In August, customs seized a shipment at Chattogram Port involving Tk137 crore in unpaid duties, where cigarette paper had been imported under a false declaration of "paper goods."

On 28 July, a raid in Sitakunda's Joramathal area led to the seizure of Express-branded illegal cigarettes worth Tk10 lakh. The drive was led by Upazila Nirbahi Officer Fakhrul Islam based on secret information.

In October 2024, large quantities of foreign cigarette paper and illegal tax stamps were seized during raids in Halishahar and Noyabazar areas. The names of former Awami League councillor Abdus Sabur Liton and his brother Abdul Mannan Khokon surfaced in connection with the case.