On his Facebook page, Vitaliy Kulyk, director of the Center for Civil Society Studies and political scientist, expressed the opinion that Philip Morris International, despite its presence in the Russian market, not only remains a major player in the tobacco sector in Ukraine, but also has significant tax advantages. He noted that the company pays significant amounts of taxes to the Russian budget, which are then used to finance the Russian army.
Kulyk noted that despite the conflict between Ukraine and Russia, Philip Morris International and other tobacco companies remain active in the Russian market. He gave the example that in 2022, the company announced its intention to sell its assets in Russia, but this attempt failed. According to Kulik, Philip Morris International’s total investment in Russia exceeds USD 2 billion.
The political scientist noted that last year the National Agency for the Prevention of Corruption included Philip Morris International and Japan Tobacco Inc. in the list of international sponsors of war because of their activities in Ukraine. However, even after this decision, companies’ activities in Ukraine were not restricted.
Kulyk emphasized that in Ukraine, there is a de facto monopoly on the sale of premium cigarettes from Philip Morris through Tedis. He noted that Mykola Azarov’s government has reduced tax rates on tobacco products, which has led to an increase in revenues for these companies. Kulyk suggested that raising taxes or imposing sanctions on these companies could be an effective measure.
As for the ways out of this situation, the political scientist expressed the view that possible measures include the introduction of restrictions or sanctions for companies that continue to operate in Russia, or an increase in tax rates for brands sold in Ukraine by these companies. He called for the adoption of appropriate legislation to address this problem.