Following a two year recession, Russia’s economy reportedly started growing again in 2017. However Russians’ disposable income has dropped again for the fourth time in a row last October, by a 1.3% compared to the same month last year. According to Moscow’s Higher School of Economics, last September, people’s wages were approximately 13% lower than in 2014, pre-recession.
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In the meantime, tax hikes on tobacco have almost doubled since 2013, and unfortunately, Russia has the highest smoking rates in Europe. Local smokers responded to the sharp increase in taxes by growing tobacco in their own backyards.
“Several governors have told me that last year people started planting tobacco in their dachas and gardens,” said the head of the Russian Senate’s budget and finance committee Sergei Ryabukhin last week, “When you go to a region, you realize with horror that people have turned to growing tobacco or shag. According to official statistics [tobacco production] has fallen 21% and people are smoking less. But in reality it’s not like that,” he added.
Russia still the world’s third largest tobacco market
An article on Quartz pointed out that despite the country’s significant drop in cigarette sales which equates to 19.6% between 2013 and 2016, as of 2016, Russia was still the world’s third biggest market for tobacco.