The Portuguese government has voiced strong opposition to the European Commission’s recent proposal to sharply increase tobacco taxes across the EU.
It argues that less harmful products such as vapes, which are widely seen as an important tool in helping smokers quit, should be taxed at a lower rate than cigarettes.
As part of its €2 trillion budget proposal for 2028 to 2034, the Commission introduced a new 15 per cent levy on tobacco products – the Tobacco Excise Duty Own Resource (TEDOR) – aimed at generating additional revenue for the EU budget.
The proposal includes steep tax hikes: at least 40 per cent for most vaping liquids, 50 per cent for nicotine pouches, and 55 per cent for heated tobacco products. The 15 per cent levy would be paid directly into the EU budget if approved.
The current plan ‘cannot be accepted’
But Portugal says the plan would cost it up to €1.5 billion in lost national tax revenue and “naturally, cannot be accepted under the current conditions.” The country joins Greece, Italy, and Romania in opposing the Commission’s approach.
On the same day the budget was unveiled, the Commission proposed revisions to the Tobacco Taxation Directive (TTD) that would raise prices across the bloc, with data showing that in Portugal, a pack of cigarettes would become €1.22 more expensive.
Lisbon’s main concern, however, lies with the proposed equal taxation of alternative tobacco products – including vapes, heated tobacco products, and nicotine pouches – alongside traditional cigarettes.
“Portugal has reservations about applying equal taxation to cigarettes and other forms of smoking that are less harmful to health,” the government said in a statement.
Advocates for vaping and other alternative products argue they pose significantly lower health risks than conventional smoking. The EU, aligning with the World Health Organisation’s view, maintains that while these products may be “less harmful,” they are still harmful.
‘Smokers should be encouraged to switch’
The Portuguese government said: “Since taxes are a form of disincentive, we believe that less harmful forms of smoking should be subject to lower taxes to encourage smokers to switch to these products.”
Portugal also warned that higher tobacco taxes risk boosting black market activity, a trend seen in other EU countries. The European Commission disagrees, maintaining that harmonising prices through increased taxes is a key strategy to combat illicit tobacco trade.
Earlier this year, a leading health agency warned that taxing safer nicotine products at rates comparable to cigarettes could have “devastating consequences” for public health.
The Global State of Tobacco Harm Reduction (GSTHR) urged governments to use taxes to ensure cigarettes are significantly more expensive than safer alternatives like vapes and heated tobacco products.
A briefing paper, titled “Safer nicotine product taxation and optimal strategies for public health”, warns that calls from the World Health Organisation to put higher taxes on safer alternatives could put smokers off from switching.
