Greek Imposes Excise Duty on Non-Tobacco Nicotine Products

In a move that has garnered support from the domestic tobacco industry, the Greek Ministry of National Economy and Finance is moving forward with a plan to tax non-tobacco products containing nicotine in a manner similar to tobacco products. The new regulations, included in a tax bill put up for public consultation by Minister of National Economy Kostis Hatzidakis, aim to cover all new tobacco products and e-cigarettes.

Equalizing Taxes on Heated Smokeless Products and Nicotine Pouches

The Ministry is imposing a Special Consumption Tax (SCT) of 156.7 euros per kilo on non-tobacco heated nicotine products, the same tax rate applied to heated tobacco products like Iqos. For nicotine pouches, the SCT is lower at 50 euros per kilogram of net weight of nicotine substrate or nicotine and other substances in solid form. Both categories of nicotine products will also be subject to a 24% VAT on top of the special tax.

Adapting to Changing Smoking Habits

As smokers’ habits rapidly evolve and they gradually shift from traditional cigarettes to alternative products without burning, the Greek state is now focusing on taxing the “use” rather than the “product” itself. This approach is already being applied to some extent with e-cigarettes, where nicotine-free liquids are already taxed.

Large tobacco companies, such as British American Tobacco, have begun introducing electrically heated products without tobacco but containing nicotine, using tea leaves as a substrate to avoid the heavy taxation on tobacco products. Nicotine pouches, which are smokeless, orally consumed products that deliver nicotine through absorption in the mouth without the need for inhalation, heating, or burning, have also emerged as an alternative.

Traditional Smoking Declines in Greece and Europe

Over the past two decades, traditional smoking in Greece has decreased by two-thirds, while in the European Union (including the UK), it has halved. In 2021, Greeks consumed 11.5 billion cigarettes, down from 32 billion in 2002, equating to approximately 1,100 cigarettes per inhabitant compared to 3,000 in 2002.

However, this discrepancy in the reduction of cigarette consumption between Greece and the EU does not necessarily indicate that Greeks have adopted healthier lifestyles than Europeans. Instead, many Greeks have turned to more economical tobacco products, such as rolled cigarettes, or, even more concerning, a significant portion of consumers have switched to illegal tobacco products, a trend that intensified after the economic crisis hit Greece in 2010.

Recently, there has also been a noticeable shift among Greek consumers towards heated tobacco products and electronic (vaporizing) cigarettes, as businesses eagerly seek out products and substances to fill the gap left by the decline in traditional smoking.

News source: Επιβάλλεται φόρος κατανάλωσης και στα μη καπνικά προϊόντα νικοτίνης

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Matthew Ma

Marketing at Ecigator

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.