By Timothy S. Donahue
Top Takeaways:
- Cigarettes in Europe have become more affordable—in 14 out of 27 EU countries, the share of GDP per capita needed to buy 2,000 cigarettes dropped between 2014 and 2024.
- EU explores sweeping tax hikes—the European Commission is considering raising minimum cigarette taxes from €90 to €215 per 1,000 units, with even steeper increases for rolling tobacco and vapes.
- WHO urges stronger policies—the WHO’s Global Tobacco Epidemic report states taxation as the most effective tool to reduce smoking and that only 15% of the world’s population lives under recommended tax levels.
Cigarettes have become more affordable in much of Europe over the past decade, prompting new calls from global health officials and European regulators for steep tax increases on tobacco and nicotine products.
According to the World Health Organization’s (WHO) latest Global Tobacco Epidemic report, the relative cost of cigarettes has decreased in 14 of the European Union’s 27 member states since 2014. The report, released Monday, measures affordability by the share of gross domestic product per capita needed to buy 2,000 cigarettes of the most popular brand in each country.
The WHO stated that many governments are not taxing tobacco products at levels sufficient to curb consumption, despite long-standing evidence that higher taxes are the most effective way to reduce smoking rates. As of 2024, only 15% of the global population lived in countries where cigarette taxes met the WHO’s recommended minimum level—75% of the retail price.
“Taxation is the most powerful tool we have to reduce tobacco use,” said Rüdiger Krech, the WHO’s director for health systems and innovation, during the launch of the report at the World Conference on Tobacco Control in Dublin. “We know what works. Now we must close the gaps.”
While Europe still imposes some of the world’s highest tobacco taxes—with 21 EU countries meeting the WHO’s benchmark—the European Commission says existing minimum tax levels have become less effective due to rising incomes and inflation. Germany, for example, taxes just 61.4% of the price of the most popular cigarette brand, the lowest rate in the bloc.
In response, the European Commission is weighing a major overhaul of its Tobacco Excise Directive. Internal documents suggest the Commission may more than double the EU’s minimum tax on cigarettes, from €90 (US$104) to €215 per 1,000 units. The tax on rolling tobacco could rise by as much as 258%.
The proposals also include new tax regimes for emerging products like e-cigarettes, heated tobacco, and nicotine pouches. Under the draft plan, high-nicotine vaping liquids could be taxed at €0.36 per milliliter, while nicotine pouches would be taxed based on weight and nicotine content.
The Commission’s impact assessment argues that taxation has accounted for about 40% of the decline in smoking rates across the EU over the past decade, but stated that current rates “have lost traction in terms of making an effective contribution to reducing tobacco consumption.”
The tobacco industry has pushed back, claiming that aggressive tax increases will drive consumers to the illicit market. A recent Europol report points to additional contributing factors, such as the growth of unlicensed manufacturing facilities and supply chain disruptions, as other drivers of illicit trade.
“Raising taxes is one of the most effective measures,” said Alison Cox, policy director at the NCD Alliance, in a statement responding to the WHO report. “It offers governments a triple win: reducing tobacco use, saving lives and healthcare costs, and raising much-needed revenue.”
The European Commission’s proposed tax revisions are still under discussion and must be approved by EU member states before taking effect. If adopted, they would represent the most significant changes to tobacco taxation in the region in over a decade.
