EU delays vote on tobacco and nicotine tax reform

The European Union has postponed a critical vote on proposed increases to tobacco and nicotine taxes, moving the decision from October to the November meeting of EU finance ministers. The Irish presidency of the Council of the EU confirmed the delay, stating it aims to secure unanimous political agreement at the upcoming ECOFIN meeting.

The postponement is largely attributed to the recent Swedish elections. As a major market for nicotine pouches and snus, Sweden has been a primary opponent of the reform, which seeks to raise minimum taxes on cigarettes and introduce new excise rates for e-cigarettes, heated tobacco, and nicotine pouches. The delay provides the incoming Swedish government time to establish its position on the matter.

The proposed revision to the EU Tobacco Taxation Directive could generate approximately 11.2 billion euros annually for the union's budget. Under the current proposal, nicotine pouches could be taxed at 25% of their retail price or €71.50 per kilogram, a significant increase from Sweden’s current levy of €18.36 per kilogram. Swedish officials have argued that their lower tax rates have successfully contributed to declining smoking rates in the country.