Taxation and Customs Union

Revision of excise rules for tobacco

In February 2020, the European Commission published an evaluation of the functioning of Directive 2011/64/EU. The evaluation examined if the excise duty rates applied to manufactured tobacco have protected public health and ensured a proper functioning of the internal market. The current evaluation assesses the performance of the Tobacco Taxation Directive against the evaluation criteria set out in the Better Regulation Guidelines.

The evaluation shows that while the current rules work well in terms of predictability and stability for Member State fiscal revenue, it is no longer as effective in deterring consumption. The increase in EU minimum rates for cigarettes and fine-cut tobacco, as set out in the Directive, only had an impact in a few Member States, which had very low levels of taxation in the first place.

The high number of smokers in the EU is still a matter of significant concern with 26% of the overall EU adult population, and 29% of young Europeans aged 15-24, smoking. The launch of the Europe's Beating Cancer Plan highlights the pivotal role of taxation in reducing tobacco consumption, in in deterring young people from smoking. In addition, price gaps between Member States – the average price of a pack of cigarettes can range from €2.57 to €11.37 – represent a sufficient economic incentive for unintended high levels of cross border shopping.

The evaluation also highlights that the emergence of new products, such as e-cigarettes, heated tobacco products and new addictive products reveal the limits of the current legal framework.

The evaluation concludes that a more comprehensive approach, taking on board all aspects of tobacco control including public health, taxation, the fight against illicit trade and environmental concerns, is needed.

Background documents

Previous reports

The evaluation process produced several other documents related to Directive 2011/64/EU: