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Tag: EU

  • Gap Growing Between EU’s Public-Health Ambitions, Economic Concerns

    Gap Growing Between EU’s Public-Health Ambitions, Economic Concerns

    The European Commission’s plan to overhaul the EU’s tobacco taxation directive has met resistance from numerous Member States, revealing deep divisions over how far and how fast the bloc should go in taxing nicotine products. The proposal, first unveiled on July 16 and discussed for the first time at the Ecofin Council in Luxembourg last week, would sharply raise minimum excise duties on cigarettes and extend taxation to new categories such as vaping and heated tobacco.

    Commissioner for Climate and Clean Growth Wopke Hoekstra defended the reform as long overdue. “Europe ranks among the highest in the world for the number of smokers,” he said. “Moreover, there are new products deliberately designed for young people, 15-year-olds, which create a new addiction to nicotine. We cannot allow the industry to reverse the narrative, spreading lies as it has already done with traditional cigarettes.”

    Under the Commission’s plan, the minimum duty on cigarettes would rise from 60% to 63% of the weighted average retail price (WAP) and from €90 to €215 per 1,000 pieces. Rolling tobacco would see its threshold climb from 50% to 62% of WAP and from €60 to €215 per kilo. The reform also introduces EU-wide minimum rates for heated tobacco and e-cigarettes, starting in 2028 at 45% of WAP or €88 per 1,000 pieces and increasing through 2032.

    While most governments support the goal of improving public health, at least 12 Member States voiced objections. Italy, Bulgaria, and Romania warned that higher taxes on traditional cigarettes could fuel illicit trade. “We have to examine the interaction between increased tax thresholds and the trafficking of illegal cigarettes,” said Italy’s economy minister Giancarlo Giorgetti.

    Croatia, Greece, Luxembourg, Malta, the Czech Republic, Slovakia, and Hungary described the proposed thresholds as too high. Hungary fears for its cigarillo sector, while Luxembourg rejects the Commission’s plan for automatic adjustments based on purchasing power.

    Sweden and Finland objected to taxing snus, with Swedish finance minister Elisabeth Svantesson insisting that “taxes should reflect the degree of harm, not the product type.”

  • Europe Risks Becoming Another Australia, BAT Boss Says

    Europe Risks Becoming Another Australia, BAT Boss Says

    Kingsley Wheaton, BAT’s Chief Commercial Officer, warned that Europe’s planned sharp tax hikes on cigarettes and alternative nicotine products risk fueling illicit trade similar to the crisis that has been created in Australia. Similar to his remarks last week at GTNF 2025 in Brussels, Wheaton told Euractiv that high excise taxes and strict regulations have pushed 80% of Australia’s tobacco market underground, resulting in taxpayer losses of AUD 9 billion ($5.9 billion) since 2019 and flourishing organized crime responsible for extortion, fire bombings, and murder.

    The warning comes as the European Commission pursues a revision of the Excise Tax Directive, proposing a 139% increase in cigarette taxes and steep rises for e-cigarettes, heated tobacco, and nicotine pouches. The EU aims to become smoke-free by 2040, targeting tobacco and nicotine consumption below 5%. While BAT acknowledges that smokeless products are not risk-free, Wheaton argued they are far less harmful than smoking and should remain accessible and affordable even as cigarette prices rise.

    Wheaton urged policymakers to focus on progressively taxing cigarettes while maintaining access to safer nicotine alternatives, alongside responsible packaging, retail licensing, and nicotine ceilings, however, the Commission continues to repeatedly reject any warning that comes from cigarette-producing companies.

  • EU TPD Panel: Coherence or Patchwork

    EU TPD Panel: Coherence or Patchwork

    At the Global Tobacco and Nicotine Forum (GTNF) in Brussels, industry and policy experts debated whether the EU Tobacco Products Directive (TPD) will promote coherence or wlll result in a regulatory patchwork across member states. The session featured Michiel Reerink of Alliance One International, Nathalie Darge of Tobacco Europe, and environmental risk analyst David Zaruk (“The Risk Monger”).

    Reerink noted that the EU’s regulatory approach has often leaned toward prohibition, arguing that “the EU’s solution was to ban the product.” He said the first TPD brought together older directives but created optional provisions that evolved into regulatory barriers. He emphasized that consistent, science-based regulation would benefit all stakeholders.

    Darge highlighted structural challenges within the European Commission’s previous consulants, citing a lack of neutrality and potential conflicts of interest. She outlined the expected timeline for the next revision, TPD3, with an initial report and proposal anticipated before 2029, followed by member state consultations and a final version possibly by 2030. Darge stressed that policymakers want a stronger voice in shaping the outcome.

    Zaruk warned that the EU’s growing use of the “precautionary principle” as a risk-management tool risks stifling innovation and redefining the very scope of tobacco regulation — “the EU is defining nicotine as tobacco now,” he said. He also criticized the inconsistency of political leadership, arguing that motivated commissioners can drive major policy shifts, while others avoid engagement.

    Panelists agreed that while political volatility, tax pressures, and public sentiment make tobacco an easy target for revenue generation, meaningful progress depends on coherent, evidence-based regulation that balances health goals with economic and consumer realities.

    The GTNF is the world’s leading annual conference discussing the future of the tobacco and nicotine industries. It is the global exchange for views and ideas between public health experts, government representatives, the industry, and investors.

  • EU Commissioner Accuses Tobacco Industry of Misleading Policymakers 

    EU Commissioner Accuses Tobacco Industry of Misleading Policymakers 

    EU Climate Commissioner Wopke Hoekstra accused the tobacco industry of recycling old tactics, comparing claims that vapes are less harmful than cigarettes to past efforts promoting “light” cigarettes.

    “They mislead policymakers about the risks of these new products, just as they did with light cigarettes in the past,” Hoekstra wrote on LinkedIn, saying that nicotine in alternative products also damages blood vessels, impairs vascular function, and stimulates tumor growth.

    His comments come as the European Commission prepares its first assessment of the health effects of new tobacco and nicotine products, with a focus on preventing youth uptake. Hoekstra has also pushed for higher taxation, backing the proposed Tobacco Excise Duty Own Resource (TEDOR), which could contribute €11.2 billion annually to the EU budget by taking 15% of member states’ tobacco tax revenues.

    However, the plan faces resistance as 14 countries, including Italy, Greece, and Sweden, have already voiced opposition.

  • EU Tobacco Tax Plan Faces Fierce Pushback

    EU Tobacco Tax Plan Faces Fierce Pushback

    The European Commission’s plan to overhaul tobacco taxation has sparked sharp opposition from member states, farmers, and industry groups, who warn it could devastate rural economies, fuel illicit trade, and hand China greater leverage over Europe’s tobacco supply chain. The July 2025 proposals — the first major update to EU tobacco tax rules since 2010 — would harmonize excise duties on heated tobacco, e-liquids, and nicotine pouches, while also bringing raw tobacco under customs tracking. A new “TEDOR” mechanism would redirect 15% of national tobacco excise revenue to the EU budget, raising an estimated €11 billion annually.

    France and the Netherlands have seen illicit trade soar, with untaxed products making up nearly 40% of consumption in France. Sweden, Portugal, and southern European producers are leading resistance, citing threats to tens of thousands of farming jobs.

    The Commission insists the reforms are vital to protect public health and modernize the single market, but unanimity in the Council will be required to push the package through by 2028.

  • Portugal Latest to Reject EU Tobacco Tax Hike Proposal

    Portugal Latest to Reject EU Tobacco Tax Hike Proposal

    This weekend, Portugal formally announced its opposition to the European Union’s tobacco tax proposals, warning the changes could cost the country up to €1.5 billion in lost revenue. The objection targets both the Tobacco Excise Duty Own Resource (TEDOR)—a proposed 15% EU tax to help fund the €2 trillion 2028–2034 EU budget—and the plan to hike cigarette taxes across the bloc. In Portugal, the price of a pack of cigarettes would rise by €1.22 under the proposal.

    Portugal is also challenging the EU’s plan to tax alternative nicotine products, like e-cigarettes and heated tobacco, the same as traditional cigarettes, arguing this contradicts public health goals.

    “Less harmful products should face lower taxes to encourage switching,” the government stated, warning that equal taxation could deter smokers from moving to reduced-risk alternatives and boost black market activity.

    The European Commission proposed a 139% increase in excise duties, from €90 to €215 per 1,000 cigarettes. While 15 countries, including France, Ireland, and the Netherlands, already back the plan, others, particularly Bulgaria, Greece, and Italy, have been vocal in opposing the hikes, warning of growing black markets and financial strain on consumers.

    The EU, aligning with WHO guidance, maintains that all tobacco and nicotine products carry health risks and should be taxed uniformly to discourage use and prevent cross-border trade distortions.

    The proposed revision to the Tobacco Excise Duty Directive must receive unanimous approval from all 27 EU member states to move forward.

  • EU Unveils Dual Tobacco Tax Proposals

    EU Unveils Dual Tobacco Tax Proposals

    Yesterday (July 16), the European Commission announced two major initiatives aimed at cutting tobacco use and boosting EU revenue: a long-anticipated revision of the Tobacco Taxation Directive and a new measure called the Tobacco Excise Duty Own Resource (TEDOR).

    The revised directive proposes higher minimum excise taxes and expands the scope to include e-cigarette liquids, nicotine pouches, and raw tobacco. Meanwhile, TEDOR would apply a uniform 15% levy on tobacco products released for consumption, expected to generate €11.2 billion annually.

    “While the proposal is meant to tackle the developments and emergence of new products (e-cigarettes, heated tobacco products, and new products containing nicotine), the European Commission also decided to revise the EU minimum rates applicable to traditional tobacco products,” the European Cigar Manufacturers Association (ECMA) said in a press release. “It disregards the different tax-bearing capacity of niche products from mass-produced tobacco and nicotine products, demonstrating a misunderstanding of the market.”

    “Increasing the EU minimum rate by 1,100% for niche products which are already the least affordable on the tobacco and nicotine market, is out of touch and completely irresponsible,” Paul Varakas, ECMA director general, said. “This proposal is very worrying. It goes against every commitment the EU Executive has made recently regarding reducing the regulatory burdens for SMEs and midcaps, companies that are largely dominating the cigar/cigarillo segment, as opposed to other products manufactured by Big Tobacco.” 

    While both measures aim to reduce tobacco use, particularly among youth, the TEDOR proposal is also part of the EU’s broader €2 trillion budget strategy.

    “[Commission President] Ursula von der Leyen and [European Commissioner for Budget] Piotr Serafin were both vocal about the need to increase Europe’s competitiveness by decreasing EU regulatory burdens,” said Adam Bartha, director of the European Policy Information Center. “The Tobacco Excise Duty Own Resource and the revision of the Tobacco Excise Directive goes against their own stated goals and increases the tax and regulatory burdens on Europeans without reducing smoking rates.”

    The Commission insists the reforms are vital to combat smoking and close loopholes fueling illicit trade, though opposition from countries like Italy and Greece could stall progress. However, both proposals face political hurdles, requiring unanimous approval from all member states.

  • Publication of Commission’s proposal to revise the Tobacco Excise Directive

    Publication of Commission’s proposal to revise the Tobacco Excise Directive

    PRESS RELEASE

    Niche traditional products and EU SMEs hit the most by new EU Commission’s proposal

    On 16 July 2025, the European Commission unveiled a proposal to revise the Tobacco Excise Directive. While the proposal is meant to tackle the developments and emergence of new products (e-cigarettes, heated tobacco products and new products containing nicotine), the European Commission also decided to revise the EU minimum rates applicable to traditional tobacco products. It disregards the different tax-bearing capacity of niche products from mass-produced tobacco and nicotine products demonstrating a misunderstanding of the market.

    Current EU minimum2025 proposed ratesIncrease
    Cigarettes90e / 1000 units215e / 1000 units139 %
    Roll-your-own tobacco60e / kg215e / kg258 %
    Cigars/cigarillos12e / 1000 units or kg143e / 1000 units or kg1092 %
    OROR
    5% ad valorem40% ad valorem700 %
    Other smoking tobacco22e / kg143e / kg550 %
    Waterpipe tobacco22e / kg107e / kg386 %
    Nicotine pouchesN/A143e / kg–
    Heated tobaccoN/A108 e / 1000 units OR155e / kg–
    E-liquids with more than 15mg of nicotine / mlN/A0.36e / ml of liquid–
    E-liquids with up to 15mg of nicotine / mlN/A0.12e / ml of liquid–

    Paul Varakas, Director General of the European Cigar Manufacturers Association:

    “Increasing the EU minimum rate by 1100% for niche products which are already the least affordable on the tobacco and nicotine market, is out of touch and completely irresponsible. 

    Cigars/cigarillos have always benefited from a differentiated tax rate due to their substantial manufacturing costs and differences. The emergence of new products on the market should not change this fact. Cigars/cigarillos should not be lumped in with new nicotine products. They have different consumption patterns and different groups of consumers.

    This proposal is very worrying. It goes against every commitment the EU Executive has made recently regarding reducing the regulatory burdens for SMEs and midcaps, companies that are largely dominating the cigar/cigarillo segment, as opposed to other products manufactured by Big Tobacco. 

    We urge Member States to reconsider some of the proposed measures so as to not severely hit EU SME and midcaps competitiveness and sustainability.”. 

    The Association is composed of the following companies: Arnold André, Burger Söhne, Canariense de Tabacos, Casa 1910, Continental Tobacco Corporation, Corita Cigars, Dannemann, De Olifant, Empresa Madeirense de Tabacos, Fabrica de Tabaco Micaelense, Gesinta, Joh. Wilh. Von Eicken GmbH, Kaliman Caribe, Oettinger Davidoff, Maya Selva, Manifatture Sigaro Toscano, Meerapfel companies, Moderno Opificio del Sigaro Italiano, My&Mi, Ritmeester Cigars, Scandinavian Tobacco Group, Tabacalera S.L.U., TOR – The New World Cigars Distributor, Vandermarliere Cigar Family, Villiger Söhne and Wörmann & Scholle.

    Contact: Paul Varakas, paul.varakas@ecma.eu, www.ecma.eu

  • EU’s Plan to Tax Tobacco, Large Companies Continues

    EU’s Plan to Tax Tobacco, Large Companies Continues

    Last week, Euractiv reported reviewing a document where the European Commission was pushing for new taxes on tobacco, large corporations, electronics waste, and carbon emissions, to help fund its next long-term budget (2028–2034). This week, more details and context are emerging.

    With the costs of most everything increasing, and the fact that the EU needs to begin repayment of €650 billion in Covid recovery loans starting in 2028, Euractiv said the EU needs new income sources beyond traditional gross national income-based contributions, which fund 56% of the current budget.

    The reported plan includes a Tobacco Excise Duty Own Resource (TEDOR), expected to bring in major revenue while supporting public health goals. Previous reports suggest the Commission has floated a 139% tax hike on cigarettes. Other proposed revenue sources include a Corporate Resource for Europe (CORE) for firms with over €50 million turnover, and green taxes like carbon levies (ETS1, CBAM) and electronics waste contributions.

    All 27 member states must approve the plan unanimously, making negotiations politically complex. However, the Commission views the next Multiannual Financial Framework (MFF) as a critical moment to secure the bloc’s economic, environmental, and defense goals.

  • EU Considers Tobacco Tax as New, Long-Term Revenue Stream

    EU Considers Tobacco Tax as New, Long-Term Revenue Stream

    The European Commission is exploring a potential EU-wide tobacco levy to help fund its next long-term budget, according to a German government report seen by Euractiv. The idea, still in early stages, could become a new source of “own resources” for the EU alongside member state contributions and customs duties.

    The proposal, which also mentions a possible levy on electronic waste, comes amid rising EU spending priorities such as defense. Tax Commissioner Wopke Hoekstra has been pushing for higher tobacco excise taxes, and a leaked draft suggests a potential 139% hike on cigarettes.

    While EU countries already apply tobacco taxes, the Commission may consider a separate levy that funnels revenue directly into the EU budget. However, any revision to the Tobacco Excise Tax Directive (TED) would require unanimous approval from all member states—some of which, including Greece and Romania, strongly oppose changes.

    The tobacco industry has warned such measures could backfire, fueling black market activity and reducing national revenues. An official proposal on the TED revision is expected this fall.