“Ambitious and coordinated action [on the revision of the tobacco taxation directives] would strengthen Member States’ tax bases and bring substantial health gains”, according to a European Parliament study published on Sunday 29 March.
“Against a backdrop of prevalent persistence of smoking, increasing uptake of new products and budgetary pressures in Member States, the revision of the Directive represents a timely and evidence-based intervention. Delayed or watered-down implementation would weaken its impact”, it also states.
According to the study, the reform represents “a significant but achievable pursuit and harmonisation”, as national trajectories already exist. This would not be “an unprecedented fiscal shock”.
However, the reform would lead to higher increases in low-tax jurisdictions such as Bulgaria and Poland, where cigarette prices remain relatively low compared to the EU average. In countries where taxation is higher, such as France, the effects on prices are more moderate and concentrated on products that are currently untaxed or under-taxed, in particular e-cigarette liquids.
Furthermore, tobacco and nicotine consumption is falling in all countries, and significantly so if prices rise, particularly cigarette prices.
The revision is currently under discussion within the Council of the EU (see EUROPE 13832/19) and the European Parliament (see EUROPE 13824/7).
Read the study: https://aeur.eu/f/ler (Original version in French by Anne Damiani)