TobaccoReporter logo

Tag: TED

  • 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.

  • EU Weighs Major Tobacco Tax Overhaul

    EU Weighs Major Tobacco Tax Overhaul

    The European Commission is preparing a sweeping reform of the Tobacco Excise Tax Directive (TED), targeting a sharp increase in taxes on traditional cigarettes and rolling tobacco, with more modest hikes planned for alternative products like heated tobacco and e-cigarettes, according to an internal working document seen by Euractiv.

    Key Highlights from the Draft Proposal:

    • Cigarette Tax: Proposed increase of 139%, from €90 to €215 per 1,000 units.
    • Rolling Tobacco: Tax hike of 258%, from €60/kg to €215/kg, aligning its burden with cigarettes.
    • Cigars & Cigarillos: Massive proposed increase of 1,090%, to €143/1,000 units or per kg.
    • Shisha/Waterpipe Tobacco: Proposed at €107/kg.
    • Nicotine Pouches: Suggested tax of €143/kg.
    • E-Cigarettes: Tax based on nicotine strength:
      • >15mg/ml: €0.36/ml
      • ≤15mg/ml: €0.12/ml
    • Heated Tobacco:
      • Unit-based: €108/1,000 units
      • Weight-based: €155/kg
      • Roughly 50% lower tax burden compared to cigarettes

    Policy Context & Challenges:

    • A 15-country coalition, led by France and the Netherlands, is urging stronger EU-wide tobacco controls, including taxation on emerging nicotine products.
    • The Commission says the current rules are “no longer fit for purpose.”
    • However, changes to the TED require unanimous support from all EU member states — a high bar amid diverging national interests.
    • Italy, Greece, and Romania have objected to treating alternative products (like heated tobacco) the same as combustible cigarettes, citing harm reduction arguments