Referred to court

The European Commission has referred Hungary to the EU Court of Justice for failing to apply the minimum EU excise duty on cigarettes.

Hungary’s lower duties distort competition with other member states and are at odds with EU health protection policy, according to the Commission.

EU rules require member states to charge a cigarette excise duty of at least 60 percent of the applicable weighted average retail price of cigarettes and not lower than €90 per 1,000 cigarettes.

Hungary was allowed a transitional period until Dec. 31, 2017, to gradually increase the cigarette excise duty and reach the required minimum threshold.

The country has raised the excise tax on cigarettes in three increments since Sept. 1, 2018. Since July 1, 2019, the tax has been HUF19,200 ($63.63) per 1,000 cigarettes plus 23.5 percent of the retail price, but at least HUF 32,200 per 1,000 cigarettes.