The Irish presidency of the EU will seek political agreement at Monday’s meeting of EU finance ministers on plans to raise minimum taxes on tobacco and extend them to e-cigarettes, heated tobacco and nicotine pouches. The European Commission originally proposed raising the minimum excise duty on cigarettes by 138.9 per cent, but the rates in the presidency’s latest compromise text have not been made public.
The effort already faces strong resistance led by Sweden, while Italy and Hungary have expressed serious reservations. Changes to tobacco taxes require unanimity in the Council of the EU, so a single member state can block them.
What the Commission proposes
The Commission considers current excise duties outdated. It says its plan is about “supporting public health and aligning fiscal policy with current market dynamics”.
Its proposal, tabled in July 2025, would raise the minimum excise duty on cigarettes from 90 euros to 215 euros per 1,000 cigarettes. It sets minimum rates of 215 euros per kilo for roll-your-own tobacco and 143 euros per 1,000 cigars and cigarillos. For newer products, it proposes 108 euros per 1,000 heated tobacco units, 12 to 36 cents per millilitre for e-cigarette liquids and 143 euros per kilo for nicotine pouches.
Compromise attempts
Negotiations began under the Danish presidency in the second half of 2025. Cyprus took over the presidency in January 2026 and tabled a compromise to ease member states’ objections. It provided for three transition periods and a gradual rise in the cigarette tax, starting at 140 euros per 1,000 cigarettes for 2028 and 2029, rising to 170 euros in 2030 and 200 euros in 2031.
Later revisions also failed. In June, Cyprus withdrew the issue from Ecofin because consensus could not be reached, and the European Parliament rejected the Commission’s proposal by 439 votes to 181, with 38 abstentions. The vote is not binding on the Council.
The Irish presidency has since prepared a new compromise text, and ministers will be asked to state their positions on it on Monday.
Opposition
Sweden flatly rejects raising the excise duty on nicotine pouches. It argues that they are a lower-risk alternative to smoking and should not be taxed like cigarettes.
Italy argues that large increases would fuel smuggling at the expense of the legal market, while Hungary is seeking to protect the interests of its domestic tobacco industry.
