One carton of cigarettes instead of four as the reference threshold for purchases between EU countries, higher minimum excise duties on cigarettes and tobacco and new taxes on nicotine-based products. But also more time to adapt to the new rules, until 2036 for ten countries, including Italy. These are the main points of the latest compromise proposal from the Irish presidency of the EU, contained in the texts sent to the delegations yesterday. Dublin (Ireland is the current president and is also the country in the Union where traditional cigarettes cost more, above 15 euros per pack) is thus attempting to unblock the reform of tobacco taxation at Ecofin on Monday.
Dublin the engine, Stockholm the brake
The main political obstacle remains the taxation of tobacco-free nicotine pouches, which are widespread in Sweden. Dublin is proposing an initial minimum tax of 10% of the price or 30 euros per kilo, to be gradually increased to 50% or 50 euros per kilo from 2032. But the final level will have to be agreed directly by ministers. Spain's requests for shredded tobacco also remain on the table. The presidency believes it is close to an agreement, a senior European diplomat said on Thursday, while acknowledging the need for further compromises. The green light for the reform will require unanimity from the Twenty-Seven.
The directive in force dates back to 2011
The objective is to update a 2011 directive, now outdated by the evolution of the market, increasing the minimum taxes on traditional products and extending harmonized taxation for the first time to more recent ones, from electronic cigarettes to nicotine sachets. The EU does not directly establish sales prices, but the minimum excise duties that states must apply, leaving them free to impose higher taxes.
The thresholds
For cigarettes, the mediation provides for a minimum threshold of 140 euros per thousand pieces from July 2028, destined to rise to 170 euros from 2030 and to 200 euros from 2032, when the requirement for an excise duty equal to at least 60% of the weighted average sales price will also come into full force, subject to the exceptions provided for. These are not automatic increases of the same amount on the price of the packages.
Ten-year transition for 10 countries, including Italy
However, the presidency proposes an additional transitional period for Italy, Bulgaria, Greece, Spain, Croatia, Cyprus, Luxembourg, Portugal, Romania and Slovenia, which to reach the new levels would have to increase excise duties on cigarettes by more than 2.35% per year on average compared to 2025. For these countries, full compliance could be postponed to 1 January 2036. The flexibility would also be extended to shredded tobacco used for do-it-yourself cigarettes.
Cross-border purchases: 800 to 200 pieces
Another chapter concerns cross-border purchases. The proposal lowers the indicative quantity used to establish whether tobacco transported by a private individual between EU countries is intended for personal consumption from 800 to 200 cigarettes, from four to one carton. Exceeding the threshold would not automatically lead to a ban or penalty: States would have to evaluate the nature of the purchase and could adopt a fixed quantitative criterion, in any case not less than 300 cigarettes.
Minimum excise taxes for electronic cigarettes
The mediation also introduces minimum excise duties on electronic cigarette liquids, even without nicotine, initially set at 20% of the sales price or 20 cents per milliliter, with gradual increases until 2032. The possibility of periodically updating the thresholds based on inflation is also envisaged, with unanimous decisions of the Twenty-Seven.
France expressed support for the mediation system, in particular the reduction of thresholds for cross-border purchases, the modulation of taxes based on purchasing power and their adjustment to inflation.
