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Cover of: Tobacco Taxation in the European Union
Sijbren Cnossen

Tobacco Taxation in the European Union

Section: Fiscal Policy in Action
Volume 62 (2006) / Issue 2, pp. 305-322 (18)
Published 09.07.2018
DOI 10.1628/001522106X120686
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Summary
Later this year, the European Commission has to submit a report to the Council of Ministers and the European Parliament with its views on tobacco tax policy in the EU. A 2004 publication issued by the Commission expressed the beliefs that tobacco consumption should be controlled by increasing tobacco excises and that harmonization should proceed on the basis of specific rates. This article reviews and evaluates EU tobacco tax policies. It supports the move towards specific taxation, but notes that there are conceptual and empirical limits to increasingly high tobacco taxes. Smokers appear to pay their way, and cigarette smuggling is a growing menace to health and revenue objectives.