A REPORT has revealed how cigarette smuggling is forcing North-East shopkeepers to shed jobs.

Retailers Against Smuggling, released today by the Tobacco Alliance, shows that most independent shopkeepers are losing £1,000 a week because of trafficking.

As a result of the trade in cigarettes, a third of retailers have had to review staff levels, while one quarter have already had to lay off staff.

The alliance, which represents 19,000 shopkeepers nationwide, says the main cause of the problem is contraband tobacco, smuggled from mainland Europe and further afield, where cigarettes can be bought for less than half the price of UK cigarettes due to lower duty levels. The cigarettes are then sold on the black market, usually in pubs but also on the streets, often to children.

John Abbott, North-East spokesperson for the alliance, who is also a Darlington shopkeeper, said: "This latest report confirms the full extent and impact of tobacco smuggling. It is having a crippling effect on local retailers and literally threatening to destroy a key part of our national heritage.

"Recent cases of seized contraband tobacco, as highlighted in the media, are simply a drop in the ocean.

"The Government needs to act now, before it is too late. Unless ministers cut tobacco taxation in order to bring the UK tobacco tax rates more in to line with our European partners, we will see more corner shops face closure.

"This will leave many people, particularly the elderly and those without transport, without a valuable open-all-hours service at the centre of their local communities."

The Government has already ruled out a cut in duties, preferring to concentrate resources on Customs' activities against traffickers.