The EU Plans To Impose A Uniform Tax: E-cigarettes And Heated Tobacco Products May Face A High Minimum Tax.

According to vaping360 news on June 13th: The European Commission may soon propose imposing a high minimum tax on electronic cigarettes in the EU. The details are as follows: A leaked report indicates that the European Commission will propose including electronic cigarettes, heated tobacco products (HTP), and nicotine pouches in the Tobacco Consumption Tax Directive (TED) system and imposing a uniform minimum tax.
If this proposal is approved, it will be the first time that the EU has uniformly taxed new tobacco products such as electronic cigarettes. The proposed tax rates are as follows: The tax rate for e-liquid is either a uniform 0.36 euros per milliliter (3.60 euros per 10 ml) or a tax rate based on concentration: ≥ 15 mg/ml: 0.36 euros per milliliter < 15 mg/ml: 0.12 euros per milliliter. For nicotine pouches: the minimum tax per pack is approximately 2 euros. For HTP products: the supplementary pack tax rate is 2.16 euros. The proposal is similar to that of 2022 but more operational.

The potential impact is significant. The tax will cause a significant increase in the price of electronic cigarettes, with some product prices doubling, especially for users in low-income countries. It has a particularly significant impact on low-nicotine users (such as those who have just quit smoking). The report acknowledges that the tax rate may destroy 17%-40% of the legal market share, prompting some consumers to return to smoking. The health argument is used as a tax justification. The report cites outdated claims such as "lack of long-term health data" and "entry-level products for teenagers" to defend the tax increase. However, it also acknowledges that taxing substitutes will offset the effect of reduced cigarette consumption and even lead to more deaths. The final outcome is uncertain and requires a unanimous vote by the Council to pass the proposal. The proposal must receive unanimous support from the 27 member states of the EU to be enacted into law. Sweden (the main producer of nicotine pouches) is considered a potential opponent. The EU has also attempted to impose taxes in the past (such as in 2020), but due to member state disagreements, it did not succeed.