Germany plans steep tax hike on shisha tobacco, prices could double

The Federal Ministry of Finance has drafted a reform of the German tobacco tax that would raise the excise on water‑pipe tobacco from roughly €56 per kilogram to €188.46 per kilogram by 2030. The current average retail price of about €139 / kg could climb to €250‑300 / kg, effectively doubling the cost to consumers. The first step, slated for January 2027, would almost double the tax amount, pushing the price of a 200‑gram package from €25‑30 to around €60.

The German Water‑Pipe Tobacco Association warns that the increase could spur a surge in the illegal market, which already supplies an estimated 80 % of the country's shisha tobacco. About 1.5 million Germans (1.8 % of the population) smoke shisha. Industry representatives fear the higher price could drive many legal retailers out of business and benefit organized crime, while also imposing substantial compliance costs on producers.

The proposal is expected to be passed quickly, according to the draft documents obtained by dpa.