- High Excise Tax Rates: Cigarette smokers in the EU pay significantly more in excise taxes than for the cigarettes themselves, with minimum rates set at €1.80 per 20-cigarette pack and a total excise duty of at least 60% of the retail price, although countries like Ireland impose much higher taxes.
- Variability Across Member States: There is considerable variance in cigarette excise taxes among EU countries, with Ireland having the highest tax at €10.71 per pack and Bulgaria the lowest at €2.03, leading to an average tax share of retail prices ranging from 67.8% to 91.6% across different nations.
- Challenges and Policy Considerations: Rising excise taxes have contributed to increased illicit cigarette consumption, with over 35 billion counterfeit cigarettes consumed in the EU in 2023, resulting in significant tax revenue losses. Discussions to update the EU Tobacco Tax Directive are ongoing, focusing on harm reduction and addressing the impact of alternative tobacco products.
Source Tax Foundation
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