The state-owned Neman Tobacco Factory in Grodno produces for BAT Rothmans and Pall Mall for its domestic market.
According to the report, police seizures in the UK show that recent raids in cities such as Hull and Sunderland have uncovered illegal packs with their logos and Belarusian health warnings.
It is estimated that about 10 per cent of the 5.5 billion cigarettes sold illegally each year in the UK come from Belarus and experts claim most are made at the Neman factory, the report said.
OLAF, the EU-wide counter-fraud organisation, said that Belarus was “one of the main source countries for cigarettes smuggled into the EU”.
MPs and activists have questioned whether BAT and other British companies should be maintaining ties with Belarus.