On World No Tobacco Day, the European Parliament published a graphic on its X account showing European smoking rates by country. “EU tobacco rules are helping to reduce smoking and prevent deaths,” the post boasted. It also notes, in much smaller text, that Sweden has become the first EU country to achieve the “smoke-free” target of getting smoking rates below 5 per cent of the population.
There’s just one problem. While Brussels claims credit for Sweden’s success, behind the scenes, it is fighting tooth and nail against the Swedish approach to tobacco policy.
For decades, Sweden has taken a lenient approach to many nicotine products like snus and nicotine pouches, in the hope that their availability will keep people off cigarettes. The results speak for themselves. The country has taken a distinctive and effective approach to reducing smoking by allowing access to less harmful alternative products. Sweden is the only EU country where snus is legal and nicotine pouches circulate freely. It chooses permissiveness, instead of punitive taxes or outright bans.
The results have been excellent: 41 per cent fewer cancer cases and 44 per cent lower tobacco-related mortality than the European average, according to the Smoke Free Sweden campaign. Yet Brussels’ tolerance for Sweden’s model is narrower than it looks. Snus, the older tobacco-based product, still enjoys the exemption Sweden negotiated on joining the EU in 1995, under Article 151 of its Act of Accession. Nicotine pouches, the tobacco-free product behind much of Sweden’s recent progress, enjoy no such protection. A pending revision to the EU’s Tobacco Taxation Directive would impose a harmonised excise duty on pouches across the bloc, while the incoming third revision of the Tobacco Products Directive (TPD), known as TPD3, is expected to cap nicotine content and restrict the flavours that have made pouches an appealing substitute for smokers.
Rather than learning from Sweden’s success, Brussels continues to push for more restrictions. The EU looks set to press ahead with revisions to the TPD which could make it much harder to access those less harmful products which have been Sweden’s smoke-free saviours. The European Commission launched a “call for evidence” on product standards and advertising rules, which ran from May 18 to June 15, 2026, while a separate revision to the Tobacco Taxation Directive, proposed on July 16, 2025, would bring harmonised taxes on nicotine pouches across the bloc for the first time.
Europe’s restrictive approach is backfiring spectacularly. The market for illegal tobacco is booming. In 2025, according to new research from KPMG commissioned by Philip Morris International and published on June 3, 2026, illicit cigarette consumption in the European Union exceeded 10 per cent of total consumption for the first time in more than a decade, reaching 10.3 per cent, or 41.8 billion units. Counterfeiting exploded by more than 20 per cent in a single year and now accounts for 44 per cent of the entire illicit market. Beyond the health risks of black-market products, EU member states lost €16.7 billion in tax revenue.
The countries with the highest illicit shares are precisely those which imposed the strictest restrictions, including outright bans on nicotine pouches. France leads, with 41.4 per cent illicit (20.5 billion cigarettes). The Netherlands sits at 22.1 per cent and Belgium is around 25 per cent.
The European Union’s favoured restrictions are to blame for this problem. There has been a major structural shift: Illicit trade is no longer mainly contraband coming from Eastern Europe but has become counterfeiting concentrated in the major Western European markets, with supply chains that are faster, more fragmented and harder to trace.
These results should not be surprising. When the state prohibits a product, it does not vanish into thin air. It moves into the black market, where it becomes more valuable. Organised crime adapts and creeps closer to the consumer. Criminal gangs enjoy a new revenue stream.
This pattern repeats itself throughout the history of substance control policies. In New Zealand, similar policies have already been hurriedly reversed. The country passed a pioneering generational tobacco ban in 2022 and revoked it in 2024, before it had taken effect, precisely because of fears of an explosion in the black market and organised crime, as well as the need for tax revenue from legal sales.
Europe needs a balanced and moderate approach to reducing smoking, not knee-jerk restrictions. The KPMG report identifies countries that have achieved sustained reductions in illicit trade through a balanced policy. The common denominator is an approach closer to the Swedish model than to the one the European Union intends to pursue.
Brussels must reverse its attempts at fiscal harmonisation of nicotine products and its increasing prohibitions and restrictions on lower-risk alternatives, allowing markets to function and countries to correctly apply the principle of subsidiarity. A more liberal market that treats adults as capable of making their own choices and that prioritises lower-risk alternative products over prohibitions would reduce both cigarette consumption and associated crime, more than any number of snowballing product regulations in Brussels.
