Illicit vape market in Singapore generated $10.4m in revenue in 2 years: Study

SINGAPORE – The illicit vape market in Singapore generated about $10.4 million in revenue between 2024 and 2025, a study has found.

In a report published on May 18, the EU-ASEAN Business Council (EU-ABC) and market research firm Euromonitor International said illicit tobacco sales in Singapore – comprising mainly illicit cigarettes and e-vaporisers – resulted in an estimated $156 million in lost government revenue over the same period.

The report added that the Republic, Malaysia, Indonesia, Thailand, Vietnam and the Philippines collectively lost US$13.1 billion ($16.8 billion) in government revenue.

As illicit operators continue to record rising year-on-year profits, the report warns that illicit tobacco will increasingly deprive governments of much-needed tax revenue and divert demand away from legitimate businesses.

Mr Chris Humphrey, executive director of EU-ABC, an advocacy organisation focused on promoting EU-ASEAN trade, said the scale of illicit trade in ASEAN is underestimated and growing at “an alarming pace”.

“Its impacts are wide-ranging, spanning economic, public health and security challenges. If left unchecked, illicit trade could jeopardise ASEAN’s economic future as a global growth engine,” he said.

Demand is being fuelled by lower prices and growing accessibility of illicit products, said the report, adding that supply is facilitated by ASEAN’s extensive and interconnected trade routes and uneven supply chain controls, which complicate Customs enforcement.

The report noted that illicit cigarettes and e-vapes are largely produced within the region in Indonesia and Cambodia, with additional supply from China, while Malaysia, Singapore and Vietnam are key distribution hubs.

The largest amount generated by the illicit e-vape market among the six ASEAN states was in Malaysia, with the trade generating about $475 million in 2025.

The country also recorded the highest illicit cigarette incidence at 57 per cent. Singapore recorded one of the lowest illicit cigarette incidences among the six nations, at below 6 per cent in the same period.

Singapore has banned vaping since 2018, with new laws introduced recently to enforce harsher penalties. Malaysia is looking to move to an outright ban in mid-2026.

Unveiling the masterminds behind illicit tobacco syndicates continues to be challenging as deals are conducted online and via encrypted platforms, the report noted.

In July 2025, Malaysian Customs officers in Port Klang uncovered a shipment of about 300,000 vapes and their components, believed to be bound for Singapore. The e-vaporisers had arrived from China in cargo declared as furniture.

Smuggling syndicates exploit free trade zones (FTZs) in the region to avoid Customs duties and regulatory scrutiny, by moving goods in small fishing vessels.

Ports within FTZs are known to be hot spots for illegal smuggling. They include Port Klang (Malaysia), Subic Bay Freeport Zone (the Philippines), Laem Chabang Port (Thailand) and Sabang, Batam (Indonesia), said the report.

Mr Firdaus Muhamad, head of consulting for the Asia-Pacific at Euromonitor International, said the decentralised nature of online sales makes it hard to crack down on illicit tobacco operations.

“Sellers can quickly shift between platforms, communication channels and delivery networks to evade detection,” he added.

The unseen dangers in vapes continue to worry lawmakers in the region. In April, police in Malaysia busted the sale of drug-laced vapes containing furanylfentanyl during a five-day joint operation in Kuala Lumpur. 

The synthetic opioid is up to 100 times stronger than morphine. It is an illegal street variant of fentanyl and poses a high risk of overdose even when consumed in small quantities.

The report noted that nearly one in four, or 24 per cent of, tobacco products consumed in 2025 in the six ASEAN states was illegal. This trend is expected to rise to 28 per cent by 2028.

In the report, EU-ABC recommended that ASEAN strengthens its response to illicit trade by enhancing existing cooperation mechanisms and Customs frameworks, and build on the grouping’s Joint Customs Control initiatives and ongoing capacity-building efforts.

Tough laws

In September 2025, Singapore enhanced the penalties for those caught possessing, using or buying vapes, while recalcitrant users may be required to undergo rehabilitation.

The laws were further enhanced on May 1, 2026. Under the Tobacco and Vaporisers Control Act, vapers can face up to $10,000 in fines, while sellers can be handed fines of up to $200,000 and six years’ jail. Smugglers can be fined up to $300,000 and jailed for nine years.

Singapore Customs and the Health Sciences Authority (HSA) continue to seize significant amounts of illicit tobacco products coming into the country.

In an operation in February, HSA seized an illegal shipment of e-vapes with a street value of more than $1.1 million. It was the largest seizure since September 2025.

Meanwhile, Singapore Customs reported that it seized 3.24 million packets of duty-unpaid cigarettes between January and November 2025, and around the same amount in the first 11 months of 2024.

It was a sharp increase from the roughly two million packets of illicit cigarettes seized annually between 2020 and 2022.