EU finance ministers failed to reach agreement Nov. 9 on proposed revisions to the bloc’s Tobacco Excise Directive after Malta refused to support a compromise backed by the other 26 member states. The proposal would establish EU-wide minimum excise duties for cigarettes, heated tobacco products, e-cigarettes, and nicotine pouches, bringing the newer nicotine categories into the harmonized taxation framework for the first time. Negotiations took place in Brussels under the Irish presidency of the Council of the EU.
Under the proposed compromise, the minimum cigarette excise duty would increase from €90 to €140 per 1,000 cigarettes in July 2028, €170 in 2030, and €200 in 2032. The package also includes provisions addressing raw tobacco and illicit trade, as well as proposed tax rates for newer nicotine products. A compromise would allow member states to agree on including nicotine pouches in the framework while postponing agreement on specific tax rates.
Malta objected to the proposed minimum rates and mechanisms for adjusting taxes, arguing they did not adequately account for differences in national price levels. Estonia, which had also raised concerns about inflation adjustments, accepted a revised proposal that would freeze minimum rates until the directive’s next revision. Irish Finance Minister Simon Harris said negotiations would resume in December, with the presidency seeking an agreement before the end of its term.