A quarter of independent retailers are considering closing up shop because of business lost to tobacco smuggling, according to a report published by the Tobacco Alliance.

The 900 independents who took part in the alliance’s annual survey claim they are losing almost £1,000 in sales a week because of illegal imports, while 73% believe the way to stop the smuggling is to reduce or freeze tax.

Audrey Wales, who runs a shop in Northern Ireland and is the national spokeswoman for the Tobacco Alliance, said: “Retailers are losing business to tobacco smugglers and something has to be done to highlight the problem.

“This is the second year in a row that shopkeepers have told us they are down £1,000. We can’t afford to lose more than £50,000 every year. If the trend carries on, we will find that independent newsagents and cornershops will disappear.”

Wales said the government must remove the incentive to smuggle: “The root cause of the problem is the high level of tobacco taxation imposed by the government in the UK.

“It is this policy that creates the huge difference in prices between tobacco in the UK and that in the rest of Europe, giving the smugglers all the incentive they need. Cut the tax. It’s as simple as that.”