The European Commission recently launched a public consultation on the excise duties applied to manufactured tobacco and the possible taxation of novel products. The consultation is intended to gather the views on options for a possible revision of the existing Council Directive 2011/64/EU. Currently, the Directive defines and classifies various tobacco products according to their characteristics and lays down the principles of taxation and relevant minimum rates and structure of excise duty.
As a part of the revision process, the question whether there is a need to propose a harmonised explicit category for e-cigarettes and heated tobacco products will be reconsidered, as these new products are currently not covered by the Directive. The Council has noted that in most Member States some of these non-categorised products, often being niche-products in the market, are not subject to an excise duty or any other specifically designed tax. In addition, the Council has already hinted that should the market share of such products show a tendency to increase, the ongoing efforts to develop an efficient taxation method would have to be intensified.
At the same time, the revision of the Council Directive 2011/64/EU has not been accepted without criticism, for not addressing a serious of concerns related to the additional burdens that the new tax entails.