New tobacco excise rates
By Doug Newhouse, 17 November 2009

European Union Finance Ministers have agreed to introduce a significant increase in the minimum level of excise tax on cigarettes from 2014 in an effort to reduce the bulk-buying of cigarettes in cheaper eastern European countries, in a move which has been led by the EU's Swedish Presidency.

In effect and from 2014, the minimum tax on a carton of 1,000 cigarettes (or loose packs to the same equivalent) across all 27 EU member states will be increased to E.90 ($134.4) per 1,000 cigarettes and no lower than 60% of the sales price.

A transitional period will apply for countries that have only recently or yet to raise prices to those rates. in effect, this means that smokers will still have access to cheaper cigarettes until January 1, 2018, in Bulgaria, Estonia, Greece, Hungary, Latvia, Lithuania, Poland and Romania.

For its own part, Sweden is now said to be considering introducing a state regulation which would restrict the volume of cigarettes permitted per arriving passenger in the country to 300 cigarettes only.

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