SALES of cigarettes are down dramatically in shops in Dublin city because of the proliferation of crime gangs selling counterfeit cigarettes for half the price door-to-door, it has emerged.

There are also concerns that some of these cigarettes contain traces of rat urine, asbestos and sawdust.

As well as selling the cigarettes door-to-door, a small number of retailers purchase and sell counterfeit cigarettes. At present, a retailer in Dublin 12 is suspected of selling counterfeit cigarettes and is under investigation, according to Retailers Against Smuggling spokesman Benny Gilsenan.

A spokeswoman from the Revenue confirmed that a retailer in Dublin 6 was recently detected selling counterfeit cigarettes. "Small quantities of packs with counterfeit stamps were discovered in a retail outlet. The tax stamp discovered has since been replaced. Officers are trained to detect counterfeit stamps using special equipment – each stamp contains several security features both overt and covert."

The spokeswoman said there was no "readily identifiable" retailer in the Dublin 12 area under investigation by Revenue for the sale of counterfeit tobacco.

Counterfeit cigarettes sold in Ireland are produced in China. Many of the tax stamps look genuine but have none of the security features which made them recognisable as counterfeit to customs officers and those with specialist training.

Gilsenan, who owns a retail outlet on the North Circular Road, said he usually has to replenish his stock of cigarettes every four weeks, but it has now been seven weeks and his store still does not need to place a new order. "From speaking to other retailers, it's the same all over Dublin city. These huge shipments of cigarettes are coming in and the gangs are selling them door to door, quite blatantly. They are selling them for between €3.70 and €4.50 a pack, that's half the retail price. It's mainly Marlboro, John Player Blue, Silk Cut and Benson and Hedges. It's having a major financial impact on retailers and needs to be combated."

Of the 135 million cigarettes seized in 2008, 57 million were found to be counterfeit. The Irish market has been directly targeted. Consignments of the Irish-only brand John Player Blue have been uncovered after arriving on a ship from China. Ireland has one of the highest tobacco prices in the EU, so is a major target for smugglers.

Revenue recently introduced a new tax stamp for cigarette packets in a bid to detect counterfeit cigarettes. It has said that retailers caught selling counterfeit tobacco will face prosecution.