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Tag: tobacco tax

  • 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.

  • Maine Jacks Cigarette, Cigar Taxes for 2026

    Maine Jacks Cigarette, Cigar Taxes for 2026

    As part of a newly signed budget bill, Maine will raise its cigarette taxes from $2 to $3.50 per pack, increase the taxes on cigars from 43% to 75% of the wholesale price, and boost taxes on smokeless and chewing tobacco. It also includes a provision to automatically adjust other tobacco product taxes in line with future cigarette tax increases.

    Governor Janet Mills championed the tax hikes in her 2025–2026 budget proposal, citing public health concerns and the state’s high smoking rates. Maine hasn’t increased cigarette taxes since 2005 and currently has the lowest rate in New England. This change will place Maine among the top states nationally for tobacco taxation, tying New York and Alaska for the sixth-highest rate and trailing only Utah in retail cigar prices due to its 86% uncapped rate. The new taxes begin January 5, 2026.

    According to Halfwheel, the tax hike means that a cigar with a manufacturer’s suggested retail price of $9.50 could see its tax increase from $2.04 to $3.56. A cigar priced at $16 would see its tax jump from $3.44 to around $6.

  • Uganda Ups Cigarette Taxes

    Uganda Ups Cigarette Taxes

    Uganda increased excise duties on cigarettes, raising taxes on soft cap products from Shs 55,000 ($15.40) to Shs 65,000 ($18.20) per 1,000 sticks, and on hinge lid cigarettes from Shs 80,000 ($22.40) to Shs 90,000 ($25.20). For non-East African Community imports, the rates doubled to Shs 150,000 ($42) and Shs 200,000 ($56), respectively.

    The tax hike came just before the announcement of the World Health Organization’s “3 by 35” initiative, where it urged all nations to increase real prices on tobacco, alcohol, and sugary drinks by at least 50% by 2035 to combat rising rates of noncommunicable diseas-es such as cancer, diabetes, and heart disease.

    Uganda’s Ministry of Finance said its move aims to reduce tobacco consumption, protect public health, and raise revenue for healthcare and development.

  • Delaware Looks to Jack Taxes on Nicotine Products Across the Board

    Delaware Looks to Jack Taxes on Nicotine Products Across the Board

    With less than a month left in this year’s half of the two-year General Assembly, new legislation was filed in Delaware’s House that would raise taxes on tobacco and nicotine products and implement higher fees for licensed tobacco sellers and vending machine operators. Delaware’s cigarette tax is currently $2.10. The proposal would increase it to $3.60 per pack.

    The sponsors said they hope this will discourage people—especially the young—from using tobacco, and that the extra revenue would help address the half-billion-dollar estimated cost of treating tobacco-related health issues in The First State each year.

    The legislation also would update the definition of tobacco products to “include any products containing, made of, or derived from tobacco or nicotine, rather than only those made primarily from tobacco.”

    In addition to raising the tax on a pack of cigarettes by $1.50, this bill would raise the tax on other tobacco products from 30% to 45% of the wholesale price, increase the moist snuff tax from $0.92 to $1.23 per ounce, expand the vapor product tax from $0.05 to $0.25 per milliliter, increase fees for wholesalers and affixing agents from $200 to $400, increase fees for retailers from $50 to $100, increase vending machine fees from $15 to $30 per machine, and increase the replacement fee for lost or defaced licenses from $10 to $20.

    If the bill passes, the new tax rates would take effect September 1st, while the licensing changes would take effect January 1st, 2026.

  • Experts Call for Simplified Tobacco Tax

    Experts Call for Simplified Tobacco Tax

    Credit: Talulla

    Tobacco taxation experts have recommended the government of Vietnam simplify the country’s excise tax structure on tobacco, reports EIN News. The move would facilitate tax administration, reduce opportunities for tax avoidance and evasion, increase the government’s revenues and have a greater impact on reducing tobacco use.

    The recommendation comes after the Vietnam government approved a tax reform strategy for up to 2030, which sets the process for switching from an ad valorem tax system to a hybrid tax system for tobacco and other products subject to excise tax.

    A number of experts suggest that a hybrid tax system that includes ad valorem and specific taxes is the most simple and effective system. In a recent report titled “Study on the Special Consumption Tax System,” PwC Vietnam called it “The right direction in line with the general trend in the world.”

    According to the report, the government has lost revenues due to tobacco smuggling, especially in 2016–2017.

    The total tax loss due to smuggled tobacco consumption has reached nearly 9 percent of tobacco tax collection, and tax collection of tobacco remained unchanged in the 2006–2020 period without factoring in inflation, the report said.

    Based on the analysis of the current excise tax policy, the objectives of the government and tax policies in comparable countries, it outlined a number of options for SCT reform along with roadmaps for the short-term and the long-term.

    The first option is transitioning into a hybrid tax system then gradually increasing the specific component and decreasing the ad valorem component at an appropriate time in future, considering to move to a single-tier specific tax system when being suitable.

    The second option is transitioning into a multi-tier specific tax system and then gradually narrow down the number of tiers to become a one-tier specific system.

    Both options have both advantages and disadvantages, but PwC Vietnam believes that the first is more reasonable for Vietnam. According to the Asia Illegal Tobacco Index, in 2017, more than 24.3 billion illegal cigarettes were consumed in Vietnam, or 23.4 percent of total tobacco consumption.

  • Bangkok to Impose Tobacco Tax

    Bangkok to Impose Tobacco Tax

    1000 baht notes with calculator on white background
    Photo: anankkml | Adobe Stock

    According to the Bangkok Metropolitan Administration (BMA), the city will implement its first-ever tobacco tax. The new structure will tax each cigarette up to THB0.10 ($0.003)  satang per stick, according to Thaiger.

    The Tobacco Tax for Local Maintenance is intended to limit tobacco consumption, and the tax collected will be used “for maintenance of Bangkok city,” according to Suthathip Son-iam, permanent secretary of the BMA.

    Other jurisdictions in Thailand already have tobacco taxes in place, and many companies previously warehoused their cigarettes in Bangkok to avoid paying taxes prior to distribution.

    “The new tobacco tax can be announced after the city finished amending the Bangkok Administration Act of 1985 to include tax collection and other related clauses under the Plans and Process of Decentralization to Local Government Organization Act of 1999,” according to Son-iam. Previous attempts to amend the act failed.

    There is no date for the tax’s introduction as of yet; the Cabinet must approve it first.