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Tag: Luxembourg

  • Luxembourg Snus Law Draws Criticism as ‘De Facto Ban’

    Luxembourg Snus Law Draws Criticism as ‘De Facto Ban’

    Luxembourg-based snus producer Heintz Van Landewyck criticized the country’s new anti-tobacco legislation, which effectively removes snus from the domestic market despite not explicitly banning it. The law, approved in late October, limits nicotine in snus pouches to just 0.048 mg per pouch—roughly the amount naturally found in two aubergines (eggplants)—making the product unappealing to consumers seeking nicotine.

    Georges Krombach, the company’s Chief Commercial Officer, warned that the legislation will push consumers to buy snus online, fueling the black market. He described the situation as an “industrial nightmare,” noting that the company had recently invested over €1 million in tax-compliant machinery for domestic production.

    Heintz Van Landewyck had supported age restrictions, warning labels, a nicotine range of 6–16 mg per pouch, and excise taxes, but the new limits force the company to relocate domestic production abroad, with a new factory planned in Trier, Germany.

    While the Alternative Democratic Reform Party (ADR) and Pirate Party echoed concerns about market disruption, other lawmakers, including CSV MP Françoise Kemp, stressed that nicotine is addictive and warned that flavored products pose risks to youth.

    Krombach expressed hope that Luxembourg might reconsider the nicotine limit to allow legal domestic sales, rather than driving consumers to foreign online sources.

  • Survey: Luxembourgers Favor Strict Tobacco Rules

    Survey: Luxembourgers Favor Strict Tobacco Rules

    A new poll by Ilres shows overwhelming public support in Luxembourg for tougher tobacco controls, with 85% of residents backing a ban on advertising—including 75% of smokers themselves. The survey, published by Fondation Cancer, also found strong backing for removing cigarette vending machines (78%), reducing points of sale (71%), and nearly three-quarters of respondents in favor of raising prices.

    The findings come as the European Commission pushes for harmonized excise duty increases across the EU, a move Luxembourg has resisted. Finance Minister Gilles Roth warned in October that the proposed tax hikes were “excessive” and risked disrupting existing price levels, arguing that aligning duties across member states could create “unequal treatment.” Cigarette sales remain a major revenue stream for Luxembourg, with 5.08 billion sticks sold in 2024, though KPMG estimates 88% were consumed abroad.

  • EU’s Tobacco Tax Harmonization Would Cost Luxembourg €1 Billion

    EU’s Tobacco Tax Harmonization Would Cost Luxembourg €1 Billion

    While the EU’s proposed Tobacco Tax Directive aims to align minimum rates across member states, experts say the harmonization would present a delicate fiscal balance for Luxembourg, where tobacco tourism funds a significant part of the budget. Cigarette prices in Luxembourg could jump from €5.10 to around €8.30, erasing its advantage over neighboring countries, costing the Grand Duchy close to €1 billion, as 95% of the country’s tobacco tax revenue comes from non-residents. At €50 million, tobacco taxes would drop from 69% to 3.5% of Luxembourg’s national budget.

    Public health officials argue the tax losses would be offset by saved healthcare costs and reduced productivity losses.

  • Luxembourg Tightens Rules on Tobacco Products, Pulls Pouches In

    Luxembourg Tightens Rules on Tobacco Products, Pulls Pouches In

    Luxembourg’s Chamber of Deputies adopted Bill No. 8333 on tobacco control yesterday (October 31), introducing stricter regulations for both traditional and emerging nicotine products. While the law transposes EU Directive 2022/2100, its most notable feature is the formal inclusion of nicotine pouches under tobacco-style rules, a category previously unregulated. Health authorities have welcomed the measure, whereas business groups have expressed concerns over potential economic impacts.

    Under the new law, nicotine pouches are now subject to advertising bans, sales restrictions to minors, labelling and notification requirements, and a strict nicotine cap of 0.048 mg per pouch or per gram. Additives such as caffeine and CBD are also prohibited. The use of these products will be restricted in public spaces, particularly in areas frequented by young people. These measures aim to curb access and prevent the perception of nicotine pouches as harmless alternatives.

    The new bill also “bans flavorings for heated tobacco products and requires health warnings on their packaging. It also sets out the rules for the labelling, presentation, and marketing of these products, including electronic cigarettes and nicotine-free liquids. Vending machines will now have to display health warnings and will no longer be allowed to display promotional graphics. Cigarette packs may only be sold in multiples of five, a measure aimed at limiting fragmented sales and making consumption less accessible to younger people,” according to Delano.

    Public health organizations hailed the legislation as a necessary step to protect youth and curb addiction; however, the Chamber of Commerce criticized the rules as overly restrictive, warning that the low nicotine limit could function as a de facto ban, potentially fostering black market sales and cross-border purchases. The law will take effect on the first day of the month following its publication in the Journal Officiel, with vending machine display requirements delayed by three months.

  • EU Trying to Stop “Tobacco Tourism”

    EU Trying to Stop “Tobacco Tourism”

    As the European Commission considers sweeping tobacco tax reform aimed at narrowing price gaps across the continent, high-income countries like Luxembourg would be hit hardest, RTL Today, Luxembourg’s main television channel, reported. The reform would be meant to deliver a major blow to “tobacco tourism.”

    Most of Luxembourg’s €1.4 billion in 2024 tobacco tax revenue came from foreign buyers, with less than 5% of the tobacco sold in the nation consumed locally. Currently, packs of cigarettes in Luxembourg cost less than €6, far below prices in neighboring France (€13) and the Netherlands (€10), attracting cross-border shoppers and smugglers.

    Though not yet formalized, the WHO’s calls for price hikes on harmful products by 2035 would raise Luxembourg’s prices €3.50 per pack of cigarettes, or 60%. RTL Today said Luxembourg’s Finance Ministry is monitoring the situation.

  • Luxembourg Sees 17% Surge in Cigarette Sales as Buyers Cross Border

    Luxembourg Sees 17% Surge in Cigarette Sales as Buyers Cross Border

    Legal cigarette sales in Luxembourg jumped by 740 million units in 2024, marking a 17% year-on-year increase, according to a new KPMG report on illicit cigarette consumption across Europe. Despite the surge, only 12% of the 5.1 billion cigarettes sold were smoked within the country, as the remaining 88% were consumed across the border, mostly in Germany, Belgium, and France, where significantly higher tobacco prices continue to drive cross-border purchases.

    Luxembourg’s average cigarette pack price of €5.10 undercuts neighboring countries by up to €3, and is less than half of the cost in France.

    While cigarette consumption is booming, illicit trade remains low. Fewer than 9 million cigarettes consumed in Luxembourg were illicit—just 2% of total consumption. By contrast, France’s illicit cigarette rate has climbed to 38%, among the highest in the EU, as high prices fuel a parallel underground market.

  • France Wants EU to Raise Tobacco Taxes in Luxembourg

    France Wants EU to Raise Tobacco Taxes in Luxembourg

    Believing higher cigarette prices directly correlate to lesser use, France has continued to tax nicotine products in hopes of reducing smoking in the country. Though the number of cigarettes purchased in the country declined 26% between 2017 and 2022, the same can’t be said of the smoking rate which remains at 29.2%, a slight improvement from 33% in 2017. The problem is that consumers, predictably, will seek out better deals, and in this case need only to cross the border into Luxembourg.

    A pack of 25 cigarettes in Luxembourg costs €8, whereas the same pack across the way in France costs  €15. A recent study by the French Observatory of Drugs and Addictive Tendencies shows that the sales drop for cigarettes at the border is even more dramatic, at 46.2%. As such, French officials are petitioning the EU to level the playing field.

    “Public health policies aimed at reducing tobacco consumption see their effect limited, in particular, because of the development of the parallel market,” French MP Frédéric Valletoux said in a recent motion for a resolution calling for changes to anti-smoking regulations at the European level.

    “Aligning tobacco taxation across the 27 Member States would reduce price disparities and limit cross-border purchases,” according to a report on tobacco published in March 2024 by a European Parliament working group. The report acknowledged the challenges of achieving this goal, as taxation remains outside the EU’s jurisdiction, and price differences between member states continue to widen.

    Another solution being pushed by the French would be to impose tobacco delivery quotas within the EU, as outlined in the World Health Organization protocol to eliminate illicit trade in tobacco products. The quotas would limit tobacco deliveries to each country based on domestic consumption. For example, Luxembourg receives three billion cigarettes annually, despite its domestic consumption being only 600 million.

    Luxembourg is raising the prices on the cheapest cigarettes in its market by €0.30 but otherwise isn’t likely to take more aggressive actions as its Customs and Excise Administration says cigarette sales reached 4.9 billion units in 2024, generating €1.4 billion in revenue for the country. This figure is expected to rise to €1.6 billion in 2025 and €1.9 billion by 2028.

  • No Vape Ban in Luxembourg

    No Vape Ban in Luxembourg

    While several neighboring countries and the European Commission are working toward banning vapor devices, Luxembourg is not.

    “We are adopting an approach based on observation and analysis of measures taken abroad,” the nation’s Ministry of Health said. “This enables us to assess the impact of these initiatives and to determine what further action, if any, could be envisaged in Luxembourg.”

    “From a health point of view, these products contain high doses of nicotine, encouraging rapid dependence, particularly among young people, and potentially leading them to other forms of tobacco consumption.”

    However, the Ministry believes that “a ban targeting disposable vapes alone would be limited in its effectiveness,” and is instead calling for a global approach that would include all electronic cigarettes and thus be “more coherent in addressing these issues.” The ministry says no studies have been carried out on the potential effect of vape sale bans in neighboring countries, and as it is, lower taxes mean that tobacco tourism is still very popular in Luxembourg.

    A 2023 bill to change the law on tobacco products is currently in committee. The bill specifically concerns the withdrawal of certain exemptions for heated tobacco products and was amended to include regulation on nicotine pouches. The text aims to ban certain flavors and limit the nicotine content of these products, however, disposable electronic cigarettes are not included in the bill.

  • Tax Hike Boosts ‘Tobacco Tourism’

    Tax Hike Boosts ‘Tobacco Tourism’

    Image: Antony McAulay

    A recent tobacco tax hike in the Netherlands has boosted tobacco tourism to Luxembourg, reports The Luxembourg Times.

    Dutch smokers have been chartering buses to stock up on cigarettes in the Grand Duchy, where cigarettes are considerable cheaper than in surrounding countries.

    For regular smokers, a trip to Luxembourg can be very profitable. Passengers on one such bus said the journey, which takes six hours one way, costs around €40 per person and allowed them to save between €400 and €500 on cigarette purchases in just one trip.

    The Netherlands allows smokers to bring up to four cartons of cigarettes from one EU country.

    According to De Telegraaf, the tax-fueled increase in demand has led to the bus operator to expand its schedule.

    Luxembourg is not the only country attracting tobacco tourists. A few months ago, Le Parisien reported on a similar excursion from the Toulouse region to Andorra, where taxes on tobacco and alcohol are much lower than in France.

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  • Tobacco Sales Boost Luxembourg Budget

    Tobacco Sales Boost Luxembourg Budget

    Image: alexlmx

    Luxembourg’s budget will be boosted by millions of additional euros in tax revenue due to higher than anticipated tobacco sales this year, reports The Luxembourg Times.

    The government expects cigarette sales to be around 6 percent higher than originally forecast in the 2024 budget, meaning that the state could reap a total of €700 million ($763 million) alone in additional excise duties. Including all taxes, the sale of tobacco products this year is expected to generate a total of €1.4 billion for the public purse.

    The direct benefit to the government’s finances from tobacco sales is expected to increase to €1.6 billion next year and €1.9 billion in 2028.

    Luxembourg will increase excise duties on tobacco products by a further 5.5 percent from next year, Finance Minister Gilles Roth said in his budget speech last week.

    While the tax increase raises the cost of the cheapest packet of cigarettes from €5.20 to €5.50, Luxembourg remains one of the cheapest places to buy cigarettes in Western Europe.

    A pack of 25 cigarettes currently costs €8 in the Grand Duchy compared with €10 in the Netherlands and €13 in France.

    Meanwhile, revenue from new nicotine products is “difficult to estimate” for 2024, a finance ministry spokesperson said. According to initial figures, around €1 million has been collected in taxes on these products between May and September.

    Overall excise revenue across all sectors is expected to hit €2.4 billion in 2025, up from €1.89 billion just three years previously.