Domestic Cigarette Sales Decline for Second Consecutive Year
Electronic Cigarette Sales Continue to Rise for Fourth Year
Last year, while sales of conventional cigarettes decreased, sales of electronic cigarettes increased. As demand for electronic cigarettes grew, last year's sales volume (660 million packs) and sales share (18.4%) both reached record highs. The tax burden imposed on tobacco products remained steady at 11.7 trillion KRW compared to the previous year.
According to the Ministry of Economy and Finance on the 18th, domestic tobacco sales last year decreased by 2.2% year-on-year to 3.53 billion packs, marking a decline for the second consecutive year following 2023 (3.608 billion packs). The real tobacco sales volume, including duty-free tobacco (3.68 billion dollars), also decreased by 1.7%, turning downward.
Breaking down by tobacco type, sales of conventional cigarettes were 2.87 billion packs, down 4.3%, showing a negative trend for the fourth consecutive year since 2020 (3.21 billion packs). On the other hand, sales of electronic cigarettes such as heated tobacco products (650 million packs) and liquid-type (5.41 million packs) totaled 660 million packs, up 8.3%, marking a growth trend for the fourth consecutive year. The share of electronic cigarettes such as heated tobacco products in total sales also rose by 1.5 percentage points to 18.4%.
A Ministry of Economy and Finance official explained, "Statistics for electronic cigarettes such as heated tobacco products have been included since 2017, and last year's sales volume was the highest since then," adding, "the share in total sales also reached a record high." The official further predicted, "Demand is gradually shifting toward electronic cigarettes, so the growth trend is likely to continue."
The tax burden, including various taxes and charges imposed on tobacco, remained at 11.7 trillion KRW last year, maintaining the previous year's level. Although the tobacco shipment volume used as the calculation basis (based on the shipment from tobacco manufacturers, which differs from sales volume) increased by 0.3% to 3.59 billion packs compared to the previous year, the tax burden did not increase proportionally due to changes in the share of tobacco types sold.
A Ministry of Economy and Finance official explained, "The tax burden per pack of conventional cigarettes is about 3,323 KRW, whereas for heated tobacco products it is lower at 3,004 KRW," adding, "While consumption of conventional cigarettes is decreasing, electronic cigarettes such as heated tobacco products are increasing, so although shipment volume rose, the tax burden remained the same."
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