The Italian Government fears a significant shift to the black market if the EU tax is approved, according to a “Reasoned Opinion” published by the Italian Government and reproduced here by Clearing the Air.
Rome is concerned with the significant potential for the proposal to divert more sales to the black market, fuelling criminal activity.
“The proposed measures could…lead to market distortions, even favouring, rather than countering, smuggling, the black market and tax evasion:, the opinion states.
Clearing the Air’s online calculator lets you find out how much the new EU tax will cost you.
Incentivising organised crime
Reasoned opinions are the mechanism by which national governments can voice their objections to EU proposals when they are first adopted by the Commission. Tax changes must be agreed by all Member States unanimously.
The EU proposal “does not effectively combat the shift of consumption of tobacco products to the illegal market, thus risking subtracting resources from public finances by incentivising the organised crime system and creating further damage to public health”.
Consultation still open
The European Commission’s consultation on a proposed tax grab on safer nicotine products will close in nine days time – readers can make their views known here.
On 16th July, the EU’s executive proposed hikes of at least 40% for most vaping liquids, 50% for nicotine pouches and 55% for heated tobacco. Clearing the Air was the first outlet to reveal the plans back in June.
15% of the money raised by the hike would be paid directly into the EU budget if approved. In total, the Commission believes that taxes on safer nicotine products would bring in just under five billion Euros in additional taxes.
The consultation, which opened in September, is a legal requirement as part of the legislative process.
