Alcohol Smuggling

News and statistics about the illegal alcohol trade. Smuggling of alcohol to evade taxes, modern day bootlegging, and data about counterfeit alcohol and sprits is collected from security agencies, criminal justice programs and other public sources.

Alcohol smuggling leads to $1.6 Billion (1 Billion British Pounds) in lost tax revenue to the United Kingdom government. The illicit sales of spirits alone causes $490 Million in tax revenue losses.

Source: “‘Growing problem’ of illegally distilled alcohol,” BBC News, July 14, 2011.

Between one-third to one-half of the alcohol market in Russia is filled with illegal alcohol, according to reports. The black market in alcohol products is estimated to be up to 6 times larger than the legitimate alcohol market in Russia.

The losses in tax revenue due to smuggling of alcohol is estimated to be $700 Million (20 Billion Russian Rubles).

Source: “The Alcohol Issue in Russia and the Baltic Sea Region,” Stockholm Centre on Health of Societies in Transition, Newsletter no 12, April 20, 2000.

Counterfeit wines in China are estimated to worth $685 Million, or 5 percent of the total wine market in the China.

Empty bottles of legitimate wines are sold on the black market at prices up to $1,500 to counterfeiters who fill the bottle with counterfeit wine.

Source: Peter Shadbolt, “Counterfeits in the grape wall of China,” CNN, March 11, 2011.

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According to KPMG’s Counterfeit Christmas Index Basket, a basket filled with counterfeit goods purchased in 11 major cities around the world was only 24 percent cheaper then a basket filled with the legitimate product.

The basket was filled with the following products, according to the Daily Finance:

  • DVD – movie in current Top 10 chart
  • CD – album in current top 10 chart
  • Counterfeit software
  • High end trainers
  • High end polo-shirt
  • Leading designer handbag
  • High end branded watch
  • High end sunglasses
  • Branded jeans
  • Good quality branded whiskey
  • Branded cigarettes

Source: Chris Wheal, “Counterfeit goods are more expensive,” Daily Finance, December 20, 2010.

According to the head of the Excise Department of Thailand, up to $334 Million (10 Billion Thai Baht) is lost each year in tax revenue due to bootlegging within the country. Bootleggers evade taxes through various methods such as under-declaring alcohol prices and committing fraud.

Source: “Same taxes for spirits urged,” Bangkok Post, October 5, 2010.

Counterfeit wine makes up to 30 percent , or 75 million liters, of all wine imports into Russia each year.

Source: “Counterfeit Wine Problems in Russia,” NTD, October 12, 2010.

Counterfeit wine makes up to 5 percent of the world’s market in cheap wine, according to Wine Spectator Magazine.

Source: Ed Soon, “Fake wines,” Malaysian Star, September 26, 2010.

Counterfeit goods sales in Russia totaled $29 Billion (910 Billion Roubles) in 2009. Counterfeit goods accounted for 6 percent of total retail sales in Russia in 2009.

In 9 of the key retail sectors of Russia, such as alcohol, shoes, tobacco and cosmetics, sales of counterfeit goods made up to 24 percent of all sales.

Source: AFP, “24% of Russia’s key retail goods fake,” Sydney Morning Herald, September 25, 2010.

According to the Union of the Czech Spirits Producers, one out of four bottles of alcohol sold in the country is counterfeit.

Source: Stephan Delbos, “One in four bottles of liquor are counterfeit,” Prague Post, April 28, 2010.

22 bootlegging gangs were discovered operating in the United Arab Emirates in 2008 leading to 398 people being arrested for alcohol smuggling.  In 2009, 33 bootlegging gangs were found with 505 people being arrested.

A bottle sold on the black market can give the bootlegger a$2 (10 UAE Dirham) profit, which increases to $8 (30 Dirham) when the alcohol is brought to the customer’s home.

Source: Sharmila Dhal and Salam Al Amir, “Murky world of UAE’s liquor bootleggers,” Gulfnews, April 15, 2010.