11/07/25

EU: EU Considers Tobacco Tax as New, Long-Term Revenue Stream

As published on: tobaccoreporter.com, Friday 11 July, 2025.

The European Commission is exploring a potential EU-wide tobacco levy to help fund its next long-term budget, according to a German government report seen by Euractiv. The idea, still in early stages, could become a new source of “own resources” for the EU alongside member state contributions and customs duties.

The proposal, which also mentions a possible levy on electronic waste, comes amid rising EU spending priorities such as defense. Tax Commissioner Wopke Hoekstra has been pushing for higher tobacco excise taxes, and a leaked draft suggests a potential 139% hike on cigarettes.

While EU countries already apply tobacco taxes, the Commission may consider a separate levy that funnels revenue directly into the EU budget. However, any revision to the Tobacco Excise Tax Directive (TED) would require unanimous approval from all member states—some of which, including Greece and Romania, strongly oppose changes.

The tobacco industry has warned such measures could backfire, fueling black market activity and reducing national revenues. An official proposal on the TED revision is expected this fall.

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EU Tobacco tax