EU Parliament Committee Demands Lower Taxes on Vapes and Tobacco

The Committee on Economic and Monetary Affairs (ECON) of the European Parliament has adopted key recommendations regarding the revision of European tobacco and nicotine taxation. In a vote of 32 in favor, 21 against, and 2 abstentions, parliamentarians signaled a preference for more moderate excise duty increases and longer transition periods than those originally put forward by the European Commission.

This legislative pushback aims to update the EU’s severely outdated 2011 taxation framework. Because the previous framework did not account for the rapid rise of alternative nicotine delivery systems, member states had begun implementing fragmented national tax regimes, leading to market distortions and cross-border smuggling.

Balancing Public Health and Market Reality

While the European Union remains committed to achieving a “tobacco-free generation” by 2040, the ECON Committee argues that overly aggressive tax hikes could backfire. Excessive taxation risks driving consumers toward illicit black markets and creating severe financial shocks for state budgets and businesses.

Rapporteur Tomáš Kubín, representing the Patriots for Europe group, emphasized the need for pragmatism. “My goal was to support a modern and more coherent framework, ensuring at the same time that the rules remain realistic, proportional, and applicable,” Kubín stated. He added that the goal is not to weaken public health objectives, but to make the directive functional in practice while protecting national revenues and reducing fraud.

Proposed Excise Duty Adjustments: Commission vs. ECON

The committee’s recommendations systematically scale back the tax rates proposed by the European Commission across almost all product categories, while delaying implementation deadlines to the mid-2030s.

Product Category	Current EU Minimum	Commission Proposal (by 2032)	ECON Recommendation (by 2033/2034)
Cigarettes	60% / Min. €94 per 1,000	63% / Min. €215 per 1,000 (by 2028)	60% / Min. €200 per 1,000 (by 2028)
E-Cigarette Liquids	No harmonized rate	20% (€0.12/ml) for <15mg/ml; 40% (€0.36/ml) for >15mg/ml	Flat 30% or €0.30 per ml (by 2033)
Heated Tobacco	No harmonized rate	55% or €108 per 1,000 pcs / €155 per kg	35% or €80 per 1,000 pcs / €200 per kg (by 2034)
Nicotine Pouches	No harmonized rate	50% or €143 per kg	28% or €50 per kg (by 2033)
Fine-Cut Tobacco (Rolling)	40% or €40 per kg	62% or €215 per kg	55% or €143 per kg (by 2034)
Cigars & Cigarillos	5% or €12 per 1,000 pcs	40% or €143 per 1,000 pcs	15% or €54 per 1,000 pcs (by 2034)
Shisha Tobacco	No harmonized rate	50% or €107 per kg	40% or €80 per kg (by 2034)

A Differentiated Approach for Harm Reduction

A central pillar of the ECON Committee’s stance is the differentiated treatment of products based on their risk profiles. By taxing alternative products like heated tobacco, e-liquids, and nicotine pouches at lower rates than combustible cigarettes, the committee aims to preserve incentives for adult smokers to transition to potentially less harmful alternatives.

Furthermore, the committee addressed the controversial inflation-indexing mechanism. While acknowledging that inflation has eroded the real-world impact of excise duties, MEPs proposed delaying the start of this mechanism from 2028 to 2036. They also recommended excluding highly volatile energy and unprocessed food prices from the inflation calculation, and capping any single annual rate adjustment at 9%.

Next Steps for EU Legislation

The recommendations adopted by the ECON Committee will face a decisive vote during the plenary session of the European Parliament on June 17. Following the Parliament’s vote, the European Council must negotiate and formally adopt the final directive.

Once approved, the legislation will enter into force 20 days after its publication in the Official Journal of the European Union. Member states will then have until December 31, 2027, to transpose the core provisions into their respective national laws.

Source: https://2eu.brussels/ro/stiri/eurodeputatii-cer-taxe-mai-mici-si-tranzitie-mai-lunga-pentru-noua-fiscalitate-europeana-a-tutunului

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Matthew Ma

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With over a decade of experience in the e-cigarette industry, Matthew Ma is a seasoned expert in both the manufacturing and usage aspects of vaping products. His extensive background has provided him with a deep understanding of the intricacies and evolving dynamics of e-cigarettes.