The Retailers Against Smuggling campaign group says the threat of the illegal tobacco trade is greater than that posed by the supermarkets.

The group's Economic Survey found small retailers were losing out on sales of other goods because customers were not coming in to buy cigarettes. One in five said they were considering closing because of the problem.

Spokesman and shop owner Ken Patel said:

"For small retailers like me, this is having a very harmful effect on our businesses and many shops face closure.

"People think buying cheap cigarettes is harmless but it is killing our businesses. I bet most people don’t even realise they are breaking the law when they buy smuggled or counterfeit tobacco."