Forum: Fight Against Smuggling

Participants included SSE Riga Professor Arnis Sauka, SKDS Director Arnis Kaktiņš, State Revenue Service Director General Baiba Šmite-Roķe, Deputy Director Sandra Kārkliņa-Ādmine, and representatives from the Ministry of Finance, the State Revenue Service, and the excise goods industry.

The Forum featured presentations on the current state of excise goods smuggling in Latvia, challenges for customs in today’s geopolitical context, and the latest research on illicit cigarette circulation and consumption in Latvia and Europe.

A recording from the event is available below in Latvian

Survey Highlights: Public Attitudes and Tolerance

As part of the Forum, the latest SKDS survey on the attitudes and tolerance of Latvia’s residents toward smuggling was presented. The study examined public opinion on smuggling as a national issue, views on purchasing smuggled goods, awareness of where such goods can be obtained, and perceptions of penalties and measures to reduce smuggling. 

The SKDS survey was conducted in July and August 2025, interviewing 1004 residents of Latvia aged 18 to 75.

The survey shows that public tolerance of smuggled goods in Latvia continues to decline: only 27% of respondents this year considered buying smuggled goods not blameworthy, compared to 30% in 2024. Back in 2013, almost half of respondents (46%) said that purchasing smuggled goods was not wrong or condemnable.

The most common smuggled goods remain cigarettes and other tobacco and nicotine products — 6% of respondents admitted buying these products in the past year, while 8% said their friends or acquaintances had done so. 2% of respondents purchased smuggled fuel (3% of friends or acquaintances) and 1% bought smuggled alcohol (2% of friends or acquaintances).

Price, Availability & Motivation

Price remains the main motivation for purchasing contraband goods. Among buyers in the past year, 88% said they chose smuggled goods because they were cheaper than legal alternatives, 17% cited similar quality, and 13% purchased items not legally available in Latvia.

Savings varied: 11% saved up to EUR 19, 31% saved EUR 20–50, and 29% saved over EUR 50 in the last month. However, 79% of respondents said they would not know where to buy contraband if they wanted to, an increase of 23 percentage points since 2019.

When asked about the upcoming ban on menthol-flavoured heated tobacco products, 43% said consumers would continue purchasing them abroad or from smugglers, while 22% expected users to return to cigarettes or switch to other products. Only 3% expected users to quit entirely.

Scepticism Toward Tax Increases

Latvians expressed scepticism about raising excise duties on fuel, alcohol, tobacco, and nicotine products to fund national defence — 67% opposed such measures, while 24% supported them. Opposition was even stronger (75%) to the EU’s proposal to allocate a portion of member states’ excise revenues to the European Commission budget.

Expert Analysis: From Fiscal Losses to National Security

Experts at the Forum emphasized that smuggling is not only a fiscal concern but also a threat to national security.

Professor Arnis Sauka, Director of the Centre for Sustainable Business at SSE Riga and a shadow economy researcher, highlighted the risks:
 

“People must realise that by buying smuggled goods — even for the sake of a lower price — they are effectively financing criminals and hostile regimes. This is no longer just a financial or moral issue. Every illicit purchase undermines Latvia’s security.”

Sauka added that illegal cigarettes continue to enter Latvia in large volumes from Belarus, raising additional security concerns.
 

“If millions of contraband cigarettes can be smuggled into Latvia at once, what’s to prevent weapons from entering the country in the same way? Combating contraband must be treated as a strategic security issue that requires both a change in public attitudes and consistent, coordinated action from state institutions
 

Toward a Long-Term Strategy

Experts agreed that Latvia needs a strategic and sustainable approach to excise and tax policy, based on economic analysis, pragmatic decisions, and enhanced support for law enforcement. Public attitudes toward contraband are closely tied to material well-being: as people become more financially secure, their willingness to buy illegal goods decreases.