Revision of the tobacco taxation directive
In “A new plan for Europe's sustainable prosperity and competitiveness”
In the European Commission's work programme for 2021, the Commission announced a revision of the Council Directive 2011/64/EU on excise rules for tobacco ('The tobacco taxation directive').
The current EU rules are being reviewed to ensure that they remain fit for purpose to ensure the proper functioning of the internal market and at the same time a high level of health protection. This is particularly important in the context of the European Action Plan against Cancer, as taxation plays a pivotal role in reducing tobacco consumption, in particular in deterring youth from smoking.
An inception impact assessment was published in January 2021. The Commission considered that the minima tax rates set by the Tobacco directive have lost their effect as a large number of Member States tax most tobacco products above the minima. Several new types of tobacco products are also not fully covered by the current directive. Furthermore, the Commission noted that the current situation results in the abuse of cross-border purchases. The Commission will consider a number of policy options based on the following building blocks:
- Minimum excise duty rates
- Harmonisation of the taxation of new products (e-cigarettes, heated tobacco products, modern oral products)
- Fight against fraud
The proposal was anticipated to be tabled in 2023.
References:
- European Commission, Commission Work Programme 2020 - A Union that strives for more, January 2020
- European Commission, Revision of excise rules for tobacco, webpage
- European Commission, Inception Impact Assessment, December 2020
Author: Pieter Baert, Members' Research Service, legislative-train@europarl.europa.eu