In June 2021, IEVA and its members participated in the public consultation organised by the European Commission on the review of the Tobacco Taxation Directive. Following the publication of the raw data by the European Commission, IEVA conducted a preliminary analysis of showing the first results.

Key facts:

• The participation rate to this public consultation was higher than usual. The survey gathered 7262 answers, 89.2% originating from EU citizens, 6% from companies and business organisation, 1.1% from business association.
• Most active respondents were based in France (26.9%), Greece (23.2%), Germany (7.9%), Poland (6.5%), Italy (5.8%), Romania (5%) and Spain (4.3%).

Regarding specific questions on e-cigarettes and e-liquids, the results provide some light trends but the answers remain overall even split:

1. Harmonization of tax rules for e-liquids containing nicotine:

• 45.6% against, 44.8% in favor, almost 10% undecided (“maybe”, “don’t know”, “blank”).
• At this stage the results of the consultation are not conclusive.

2. Harmonization of tax rules for e-liquids that do not contain nicotine:

• 50.8% against, 40% in favor, almost 10% undecided (“maybe”, “don’t know”, “blank”).
• There seems to be a clearer trend for opposing such harmonization.

3. Establishment of a minimum tax on e-cigarettes:

• 46.7% answered « none », 41.6% answered « 0.10 € / ml », 5.6% answered « 0.30 € / ml », 6.1% « don’t know » or no answer.
• There seems to be a clear trend for no minimum tax (46.7% answered “none”) or at the lowest level.

Analysis of the results

The main question to be answered now is how will the Commission interpret the 10% indecisive parties (“don’t know”, “maybe”, “blank”) for point n°1 and n°2 as those 10% could indeed tilt the balance in a way or another.

If we consider that the Commission is willing to further harmonize the tax rules regarding e-liquids and e-cigarettes, a possible scenario could be:

• Harmonization of tax rules for e-liquids containing nicotine (44.8% in favor + 10% indecisive > 45.6% against).
• No harmonization of tax rules for e-liquids that do not contain nicotine (the gap is clearer here).
• Introduction of a minimum tax on e-cigarette as it is more aligned with the Commission’s intent on the matter.

Next steps

• With the closing of the public consultation, the European Commission will now be able to complete to drafting of the proposal to revise the tobacco taxation directive.
• The document was expected to be presented at Q3 this year. We can reasonably expect it for Q4 2021 or Q1 next year.