Bootleg goods cost shops dearly

The illegal trade is hitting the region the hardest and confirms its position as Britain's biggest market for smuggled contraband.

Scores of small shop owners across the country were asked in a survey how much they were losing to the trade each week.

Average yearly losses in the North-East were £56,640 - up by £20,000 on the national average for each shopkeeper.

The survey by the Independent Retail News publication is expected to lead to renewed calls for a cut in duty ahead of Chancellor Gordon Brown's budget next month. Rob Hastings-Trew, North-East spokesman for Customs and Excise, said: "We want the public to be aware of the effect smuggled cigarettes and alcohol has on local shopkeepers.

"We are not unaware of the problems they are having."

The combined cost of smuggled tobacco and alcohol to the Government is put at £4.25bn a year.

Profits from illegal contraband often end up in the pockets of hardened criminal gangs and fund other illegal activities.

The North-East has been the subject of a series of high-profile customs operations in recent years in a bid to crack down on the problem.

More than 45 million illegally smuggled cigarettes were confiscated in the year 2000 alone.

Mr Hastings-Trew said: "The make-up of the North-East with a great number of people on low incomes makes it the sort of area likely to be targeted heavily by organised criminals and we are fully aware of this."

Sixty six per cent of retailers surveyed said they had been offered bootleg goods in the last six months and almost ten per cent knew of stores that had closed because of the problem.

Reacting to the survey, Government Customs Minister Paul Boateng said: "This highlights that smuggling continues to be a real threat to legitimate trade.

"We are constantly looking to improve preventative measures against this criminal activity which robs the UK of money that could be spent on schools and hospitals."