While the Ministry of Health continues with the new anti -tabaco law that prohibits smoking and vaping on terraces, the European Commission takes steps to apply the highest rise in tobacco taxes in years. Only to get an idea is estimated that the tobacco pack in Spain rises an average of 1.40 euros, which will make some tobacco packages reach 7.00 euros, thus following the model of France and the Netherlands.
Even so, experience in other countries in Europe shows us that a tax rise can cause the entry of greater consumption of the black market, which therefore brings a lower public collection. Experts warn that “the remedy can be much worse than the disease.”
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The initiative, which could be approved in the coming months although it still does not have a specific date, seeks to unify the taxation of tobacco throughout the European Union. To do this, it dramatically elevates minimum taxes and cigarettes will go from 90 to 215 euros per 1,000 units; the liar tobacco from 60 to 215 euros per kilo (+258%); And the cigars will be the most punished, going up 12 to 143 euros per kilo (+1,090%). This will translate into a strong increase: the usual pack in Spain will go from 5.40 to almost 7 euros, and a 30 grams liar tobacco bag will be more than 6.60 to 10.60 euros, 60% more.
| Product | Current Tax | New proposed tax | Increase (%) | Estimated price impact | Estimated final price example |
|---|---|---|---|---|---|
| Cigarettes | € 90/1,000 units. | € 21/1,000 units. | +139 % | +1.40 €/Cajetilla approx. | From € 5.40 to € 7.00 per package (+30 %) |
| Liar tobacco | € 60/kg | € 215/kg | +258 % | – | 30 g bag: from € 6.60 to € 10.60 (+60 %) |
| Pure (cigarritos) | € 12/kg or 1,000 units. | € 143/kg or 1,000 units. | +1.090 % | – | Cajetilla: From € 4.25 to € 7.00 (+64 %) |
| Heated tobacco | not specified | € 108/1,000 units. | – | +1.20 €/Package approx. | – |
| E-liquid (vapers) | not specified | 0.12 – € 0.36/ml | – | Variable | – |
| Nicotine bags | not specified | € 143/kg | – | – | – |
More taxes does not mean more income
Although the European Commission presents the measure as a “public health issue”, the main motivation is financial. Brussels needs more resources to face the payments of the Next Generation Fund. Spain, for example, raised in 2024 more than 8,965 million euros in tobacco taxes. However, recent experience in other European countries does not invite optimism.
The most extreme case is the French, where the cajetilla already exceeds 12 euros and smuggling has shot up until the 2017 figures duplicate. A KPMG report shows that in 2024 18.7 billion illegal cigarettes were consumed in 2024, of which 7.8 billion were fakes. The cost for public coffers was 9,400 million euros in a single year. That is, uploading taxes does not guarantee either less consumption or more collection: smokers continue to buy, but they do it in parallel markets without fiscal control.
In the Netherlands something similar happens. The illegal tobacco already represents 17.9% of the total consumption, twice as a year earlier, and the loss of tax revenues is around 900 million euros. In both countries, fiscal increases and generic packaging have caused an opposite effect to the expected: nor has smoking fallen nor has collection increased.
Spain begins to notice the effects
The situation in Spain already reflects the first symptoms of the problem. The smuggling of cigarettes has returned to the levels of 2021, with 1.4 billion counterfeit units and a loss of public revenues of 52 million more than the previous year. In the words of Christos Harpantidis, senior vice president of external affairs, “the availability of cheaper cigarettes and without control undermines efforts to reduce smoking and damages tax collection, employment and legitimate companies.”
According to KPMG, smuggling already represents 10% of total consumption in the European Union, with a hole of 19.4 billion euros in tax revenues. Even so, Brussels and the Spanish government maintain the processing of the norm, without a specific date of entry into force, or a clear plan to strengthen customs and police surveillance.
Faced with the failure of France and the Netherlands, other countries in southern Europe such as Greece, Italy or Portugal have opted for more moderate increases and greater pressure in border control. The result has been a lower incidence of smuggling and a more stable balance between collection and public health.