Philip Morris International, JTI pay $8B to Russia over year, which went to war - experts

Philip Morris International, JTI pay $8B to Russia over year, which went to war - experts

Transnational corporations Philip Morris International (PMI) and Japan Tobacco International (JTI) paid $8 billion to the Russian budget last year alone.

This was announced during a press conference on "How to stop financing the Russian military budget" by the executive director of the NGO Zhyttia (lit. Life) Dmytro Kupyra, an Ukrinform correspondent reports.

According to Kupyra, among companies that are not involved in oil and gas production, transnational corporations are the largest revenue generators and largest taxpayers in Russia. Among them, tobacco companies occupy the first two positions in terms of Russian budget financing.

"The leader is PMI, which paid $4.9 billion to the Russian budget last year alone. The 'contribution' of JTI is more than $3 billion per year. Thus, tobacco companies are the largest transnational sponsors of the Russian budget - the budget of the war against Ukraine," the executive director of the NGO Life stated.

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According to his calculations, the money PMI earned for Russia in 2022 alone could buy 4,900 Kalibr missiles, 78 fifth-generation Su57 fighters, or 1,089 T-90 tanks.

"We didn't even try to calculate how much it would be in Shaheds, as we would be talking about tens of thousands of units. In general, if we analyze the data from the Russian media, it turns out that the share of this tobacco company in financing Russian war of aggression in 2024 will be 5%," Kupyra said.

He reminded that these tobacco companies are on Ukraine's National Agency for Corruption Prevention's (NACP) list of international war sponsors. This is the first important step taken by Ukraine. But the pressure, according to the expert, needs to be increased. Inclusion in the register of international sponsors of war is only about reputational losses, and it has no legal consequences for the economic activities of the defendants in Ukraine, Russia, or any other country in the world.

Read also: Ukraine adds Belgian gas company Fluxys to list of war sponsors

"We would like to draw the attention of our Western partners to the fact that their pressure on companies that continue to operate in Russia should be stronger. Because it is insincere when they help Ukraine with one hand (for which we are sincerely grateful), but at the same time turn a blind eye to the fact that very large funds are generated in the Russian budget thanks to the work of multinational companies. If they were not there, the Russians would not be able to replace this resource, it would be completely different money," Kupyra said.

According to the expert, Ukraine could demonstrate to its partners by example what practical steps can be taken to have a real impact on businesses that sponsor the war. To this end, he asks parliamentarians to approve the draft law that has already been adopted in the first reading, which provides for an additional tax on companies that continue to operate in Russia.

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"Specifically, in tobacco control, I see two simple steps that will save the health of Ukrainian youth and affect the presence of tobacco companies that sponsor the war in Ukraine. First, we need to raise excise taxes on tobacco products. Moreover, this is Ukraine's obligation under European directives and the Association Agreement. The second is to ban the visible placement of tobacco products. We do not need to offer Ukrainian youth these harmful products, especially those produced by companies that sponsor Russia's war against our country," Kupyra summarized.

Read also: Foreign businesses pay almost $20B in taxes to Russian budget year before invasion

As reported, in August, the NACP added two of the world's leading tobacco corporations, PMI and JTI, to the list of international sponsors of war. The companies continue to do business in Russia and support the economy of the aggressor country by paying multibillion-dollar taxes to its budget. Analysts estimate that PMI's total investment in Russia exceeds $2 billion. As for JTI, although its representatives announced the suspension of new investments and marketing activities in Russia, the company still continues to produce and distribute its products there.

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