Fake in Italy branches out into toothpaste, soaps: reports MILAN (Reuters) - Counterfeiters of the kind who normally concentrate on ripping off luxury labels are diversifying into cheaper daily items like soaps and shampoos to lure Italian consumers cutting back on everything amid the recession, a study on Monday said. Trademark counterfeiting generated 6.9 billion euros ($9 billion) in sales in Italy in 2010, with clothing, accessories and software as best-sellers, Rome-based think-tank Censis said. "The impact of counterfeiting on the economy is huge," Censis said in a statement, adding that it cost 1.7 billion euros in missed tax revenues for Italy's depleted state coffers. However demand for fake goods is expected to slow down this year as the crisis eats into family savings, Censis said. With Italians struggling under the impact of a year-long recession, tax rises, falling disposable incomes and rising unemployment, consumer spending is headed for its biggest post-World War Two decline this year. Growth in sales of counterfeit goods slowed to 19 percent at the peak of the crisis in 2009 from 37 percent in 2007, Censis said. Sales rose again in 2010 as the economy recovered. Although volumes may be falling, cheaper counterfeit products are gaining traction from demand for lower-priced goods, Censis said. Cosmetics are emerging as the fastest-growing category with sales of counterfeit lipsticks and pencils growing 15 times over the past decade, Italian cosmetic association UNIPRO said. Exports of food also face competition from a booming counterfeit industry offering products ranging from fake Parmesan cheese to spaghetti. Counterfeit Italian food generated sales of 1.1 billion euros in 2010, the third-biggest sector behind clothing and software, according to Censis. "This is a global fraud that must be stopped," agriculture and food lobby group Coldiretti said in a separate statement. The renowned "Parmigiano Reggiano" cheese remains the most-copied product worldwide, Coldiretti said, with Brazilian "parmesao" adding to the list of dubious parmesan labels. Reporting by Antonella Ciancio, Massimiliano Di Giorgio, editing by Paul Casciato