The 2,429 Shaheds, or 402 Kalibr missiles, or 335 X-101 missiles that Russia is constantly shelling Ukraine with could have been financed by tobacco companies Philip Morris International and Japan Tobacco International.

In 2023, the NACP added PMI and JTI to the list of international sponsors of the war. However, their Ukrainian representative offices continue to lobby for their own interests and even receive tax rebates for their products.

The tobacco industry not only destroys the health of Ukrainians, but also directly sponsors the aggressor, says Olha Masna, communications manager at the NGO “Life”. Read more in her blog specially for Ekonomichna Pravda. Below are the key points.

The tobacco companies Philip Morris International and Japan Tobacco International, which are recognized international sponsors of the war against Ukraine, received the largest revenue in Russia among all international companies in 2023 – $3.6 billion ($6.9 billion – PMI and $6.7 billion – JTI). They also significantly increased their profits and income tax payments: $402 million in 2023. These are the figures from the latest report (January 2025) of the B4Ukraine coalition based on data collected by the Kyiv School of Economics.

According to the website of the Russian branch of Philip Morris, the company has two factories in Russia, a distributor with branches in one hundred cities, and 3,200 employees whose mobilization is required to be facilitated by international companies. Japan Tobacco International has four factories, 66 offices, a distribution company, and about 4,000 employees in Russia. In addition, PMI and JTI tobacco products are supplied to the occupied Ukrainian territories, most likely from Russia. 

At the same time, tobacco companies are trying to whitewash their reputation by providing humanitarian support to the population of Ukraine. In 2024, the Ukrainian media spread the news that since the beginning of the great war, Philip Morris had allocated UAH 400 million for the humanitarian needs of Ukrainians, while in 2023 it paid 220 times more in income tax in Russia alone. 

On December 4, the Verkhovna Rada passed the draft of a government bill to increase excise taxes on tobacco products. It proposed to increase the excise tax on cigarettes to 90 euros per thousand pieces by 2028, and to create a 25% preference for tobacco products for heating (i.e., “ecigarettes”). Such a privilege will lead to a shortfall of at least UAH 18.6 billion in state budget revenues over four years.

The Vienna Institute for International Economic Research has estimated that a lower excise tax on the “iqos” cigarettes would lead to 22,500 premature deaths that could have been prevented if taxed equally. The tobacco excise policy should protect the population from being attracted to smoking, which is significantly influenced by the price.

In addition, it is possible to reach the EU minimum level (90 euros per thousand packs) in two years, not four, as proposed by the adopted law. This will allow the state budget to be more substantially filled with funds from the sale of unnecessary harmful products, more than half of which are held by PMI and JTI in Ukraine.

Interaction of the government and the public with tobacco companies should be unacceptable, especially with the sponsors of war.