Philip Morris in Ukraine pays 18% more taxes in first quarter of 2026 compared to same period last year

Philip Morris in Ukraine paid UAH 15.1 billion in taxes, which is 18% more than in the same period last year. The main part of tax revenues was provided by excise and VAT, the company said in a statement.

"The beginning of 2026 was extremely difficult for all Ukrainians due to constant shelling, prolonged power and heating outages. For Philip Morris, the missile attack on the Kharkiv factory in January was an additional serious shock. However, despite these challenges, we have fully fulfilled our obligations to the state, partners and consumers. The increase in taxes paid was primarily driven by an increase in excise duty and well-coordinated and efficient operational work. In total, we have paid UAH 189 billion in taxes since the beginning of the full-scale war. This amount could have been much higher if the government had been more effective in fighting the illegal cigarette and vape market," commented Philip Morris Ukraine CFO Serhii Kalnoochenko.

According to him, over the past few years, the illegal market in the tobacco industry has transformed into two categories. The first is the gray production of cigarettes, which also fakes international brands. Its share has been at around 18% for the last six months. The second is the illegal trade in e-cigarettes, which, according to Kantar, is more than 93%. Although illegal vapes are a relatively new phenomenon for the market, they pose an equally serious threat to both the state budget and law-abiding businesses.

"The state loses more than UAH 28 billion in taxes due to the illegal cigarette market and more than UAH 7.5 billion due to the illegal trafficking of vapes. At the same time, illegal e-cigarettes are sold openly, even near metro stations and in shopping and entertainment centers. If we draw an analogy with other areas, the amount of losses from the illegal cigarette and vape market is almost twice as much as the state's expenditures to support veterans planned in the budget for 2026," he added.

This amount includes two law firms: Philip Morris Ukraine PrJSC and Philip Morris Sales & Distribution LLC.

Ref. Philip Morris in Ukraine is one of the largest taxpayers and investors. The company also provides humanitarian support to communities in the Kharkiv, Lviv, and Kyiv Regions, and cooperates with the largest rehabilitation funds - Superhumans, U+System, UNBROKEN, and others. Since the beginning of the full-scale invasion, projects worth UAH 431 million have been implemented.

We would like to remind you that the Philip Morris factory in Kharkiv, Ukraine, has been suspended since February 24, 2022, the beginning of the full-scale russian invasion.

In 2024, Philip Morris Ukraine opened a new factory in the Lviv Region, investing USD 30 million in its launch. To work at the new factory, 250 employees of the Kharkiv factory were relocated.