On Monday 9 November, EU finance ministers will try to reach a unanimous agreement on reforming the directives that govern excise duties on tobacco products.
The Irish Presidency of the Council of the European Union believes an agreement on this issue could be reached on Monday (see EUROPE 13970/9), and is seeking a discussion at ministerial level.
Sweden, which does not yet have a government in place, could be the main obstacle to an agreement, and may refuse to accept the gradual increase in excise duty on nicotine pouches proposed by the Irish authorities: €30 per kilogram in 2028 and 2029, €40 per kilogram in 2030 and 2031, and €50 per kilogram from 2032 onwards. Sweden feels an agreement will only be possible if the excise duty remains close to the level applied in Sweden, which is around €20.
Bilateral negotiations will continue ahead of the ECOFIN Council meeting. New proposals from the Irish Presidency aimed at bringing the positions closer together were expected on Friday evening.
See the Council of the EU note: https://aeur.eu/f/oar
VAT. The Council of the EU will adopt without debate the legislative proposal on VAT included in the customs reform that abolished the exemption of parcels worth less than €150 from customs duties (see EUROPE 13939/15).
The proposal, which would amend the VAT Directive (2006/112), also seeks to remove this threshold for VAT purposes in order to align e-commerce customs and VAT rules.
See the agreed legislative text: https://aeur.eu/f/ob5
Stability Pact. The ECOFIN Council will approve without debate Italy’s request to activate the Stability and Growth Pact’s national escape clause until 2028, to increase national military spending (see EUROPE 13973/12).
Italy also wants to use this fiscal flexibility, to a limited extent (0.3% of GDP per year and a cumulative 0.6% of GDP over 2026-2028), for measures supporting households and businesses that have been affected the most by the surge in energy prices caused by the Israeli-American war against Iran that began in February.
See the Council’s draft recommendation: https://aeur.eu/f/oau
Ukraine. Ministers will review macrofinancial assistance to Ukraine, which is covered for 2026, and Ukraine’s budgetary needs for 2027, under a recurring agenda item on the macroeconomic repercussions of Russia’s military aggression. Next year, a nearly €70 billion funding gap will need to be filled, with the EU providing two-thirds of the amount (see EUROPE 13972/2).
The European Commission has been tasked with presenting financing options ahead of the extraordinary European Council summit on 26 and 27 November, so the EU27 can take a decision before the end of 2026. In order to continue providing its own macrofinancial support in 2027, the IMF needs guarantees from the EU (see EUROPE 13962/1).
The simplest and quickest option would be to increase the EU’s current €90 billion loan for 2026 and 2027 by amending the rules governing the 2021-2027 Multiannual Financial Framework (MFF). However, some ‘frugal’ Member States are drawing links between these negotiations and those on the post-2027 MFF in order to put pressure on the ‘Friends of Cohesion’ countries that are reluctant to provide financial support to Ukraine.
“There is a real political ambition to bring both files to conclusion by December”, a senior EU diplomatic source said on Thursday 5 November.
RRF. Ministers will discuss the implementation of the EU’s Covid-19 recovery strategy, Next Generation EU, for which all Member States submitted their final payment requests on time, before the end of September (see EUROPE 13950/22). The Commission intends to issue its assessment of Hungary’s payment request before 20 November.
Simplification. Building on work initiated by the Danish authorities in 2025 (see EUROPE 13712/10), ministers will exchange views on the economic consequences of EU legislative proposals.
They will also be briefed on ongoing work to simplify existing legislation, particularly in the financial sector, where a banking ‘Omnibus’ proposal is being prepared based on the Commission’s 2027 work programme and annual report on regulatory simplification (see EUROPE 13975/20).
Miscellaneous. Finally, the ECOFIN Council will approve conclusions on progress in producing statistics, and set out priorities for future work. The Irish Presidency and the Commission will brief ministers on the outcome of the G20 finance meeting held in Bangkok. (Original version in French by Mathieu Bion)