Andrew Thewlis told delegates at the Federation of Wholesale Distributors' annual conference: "At a time when the government needs every penny, it [duty fraud] will feed through and affect us all.
"People with well-established principles are being tested - whether it's suppliers having to find sales wherever they can or wholesalers taking those offers that are too good to miss."
He urged wholesalers to think about the long-term health of the industry before getting drawn in.
Meanwhile, managing director of Sugro UK Philip Jenkins attacked the government for its campaigns demonising sweets, soft drinks and alcohol, saying it was jeopardising the future of legitimate products.
He said: "They believe we are all incapable of making decisions for ourselves on what is good and bad for us. I need you all to write letters and lobby the government through your MPs ."