A leaked compromise proposal from the Cypriot presidency on the European Union’s Tobacco Excise Directive has drawn sharp criticism for undermining harm reduction.
That has come despite it lowering some tax rates on vaping and heated tobacco compared to the European Commission’s original plan.
The draft, seen by the Clearing the Air, a website in favour of harm-reduction, and due for discussion in the European Council working group on January 21, reduces minimum excise duties on several categories but maintains a structure that critics say discourages smokers from switching to less harmful alternatives.
The proposal openly states it aims to “discourage tax-induced substitution between products”, prompting Michael Landl, director of the World Vapers’ Alliance, a pro-vapers organisation, to label it “the opposite of harm reduction”.
“They made a tiny step back on the numbers but the direction is still completely wrong,” Landl said. “Nicotine users are treated as cash machines. Slightly lower rates do not change the fact that this plan will keep people smoking and punish those who try to quit with less harmful alternatives.”
He argued the Council’s wording effectively tells smokers to “keep smoking cigarettes even if they can’t quit”, prioritising fiscal goals over public health by narrowing the price gap between combustibles and lower-risk options — hitting lower-income groups hardest.
The EC’s initial draft already faced backlash for equating reduced-risk products with traditional tobacco and risking black-market growth, with industry estimates of €3 billion in lost revenue from illicit trade.
European countries including Sweden, Greece and Czechia — where harm-reduction policies have led to significant declines in smoking rates — have been opposing EC plans and want to keep adhering to their successful policies.
For cigarettes and rolling tobacco, the minimum excise rates in the new proposal are lowered to €200 per 1,000 sticks and €200 per kg, down from the proposed €215 in both cases.
The phase-in period is also extended, with full rates only applying by 2032 instead of 2030.
Heated tobacco products see their minimum rate reduced to €300 per kg or €100 per 1,000 sticks, from the original €360 per kg.
The text refers to these products as a “modern alternative” to traditional cigarettes.
Vaping liquids would now face a flat minimum excise duty of €0.20 per ml from 2030, replacing the EC’s more complex tiered system based on nicotine content, which went up to €0.36 per ml. This change is justified by the need for administrative simplicity.
Nicotine pouches remain unchanged, still subject to a 50 per cent tax on the retail selling price, which keeps them disproportionately burdened compared to the other categories.
A coalition of international tobacco sector companies, including packaging, transport and agriculture, has issued a strong warning to the European Commission. https://t.co/hrGeZDQk4q
— Brussels Signal (@brusselssignal) December 11, 2025
