EU ministers leave tobacco and nicotine excise overhaul unresolved

Council outcome leaves existing law unchanged

The European Commission confirmed after the Economic and Financial Affairs Council meeting that ministers did not agree the tobacco-taxation package. The package had been tabled for a Council general approach under the special legislative procedure in Article 113 of the Treaty on the Functioning of the European Union, where tax measures require unanimity. The result is a failed political-agreement attempt, not adoption, enactment or rejection. Directives 2011/64/EU and 2020/262/EU remain unchanged, and no new minimum rates, filing duties or application dates arose on 9 November.^[1][2]

What the Presidency compromise proposed

The tabled text would recast the rules for cigarettes, cigars, fine-cut and other smoking tobacco, while expressly covering waterpipe tobacco, heated tobacco, e-cigarette liquids, nicotine pouches and other nicotine products. It would also bring raw tobacco within the harmonised movement-control framework, although the proposed minimum rate for raw tobacco was zero. Member States would generally have had to transpose the substantive amendments by 30 June 2028 and apply them from 1 July 2028. Those dates remain proposal dates only.^[2][3][4]

Nicotine-pouch rates remained the obstacle

The Presidency identified nicotine-pouch minimum rates as the outstanding political issue. Its cover note described a staged minimum of 10% of retail price or EUR 30 per kilogram, rising to 25% or EUR 40 for 2030–2031 and ultimately 50% or EUR 50 from 2032. The cover note says the first stage would begin on 1 January 2028, while Article 22(6) of the accompanying draft says 1 July 2028. That internal discrepancy should not be resolved editorially without a corrected or subsequently agreed text.^[2][3]

What businesses should do

Manufacturers, importers and distributors of tobacco, vaping liquids, heated products and nicotine pouches should keep the compromise rates and product definitions in scenario models, but should not configure them as law. Existing national excise rates, registrations, stamps, movement controls and returns continue. The next material milestone is a revised compromise or Council general approach, followed by any required European Parliament consultation, formal adoption, Official Journal publication and national transposition.^[1][3][4]