The European tobacco sector calls on Brussels over the tobacco directive review

In November 2025, the European tobacco sector made a joint appeal to the European Commission concerning the tobacco regulation measures to come. The move comes as the European Union prepares to tighten its rules on tobacco products (revision of the TPD2 directive) and its tobacco taxation.

Background: towards a new tobacco directive in Europe

The 2014 European directive on tobacco products is due to be revised, and the Commission plans to begin that work in 2026 under pressure from several member states. In parallel, Brussels proposed an overhaul of tobacco taxation in July 2025, with a drastic increase in minimum excise duties (+140% on cigarettes, +260% on roll-your-own tobacco) and the inclusion of new nicotine products (vaping, heated tobacco, pouches) in the tax base. The prospect of these changes explains the sector’s mobilisation.

A joint declaration from the tobacco sector

In early December 2025, a joint letter signed by 88 organisations from the European tobacco sector, from the major manufacturers (BAT, JTI, Philip Morris, Imperial Brands) to associations of tobacco growers, makers of smokeless tobacco products and tobacco retailers in several countries, was sent to the president of the Commission, Ursula von der Leyen, and to commissioner Wopke Hoekstra. It is an unusual coalition, and a sign of the shared concern of manufacturers, farmers and retailers about the measures Brussels is considering.

The declaration stresses the socio-economic weight of tobacco in Europe. The sector carries considerable weight: it accounts for 224 billion euros of GDP, 112.9 billion euros of annual tax revenue and 2.1 million jobs in Europe. Figures of that order, the signatories argue, must be taken into account by the Commission when it makes its choices.

Key messages addressed to the Commission

The professionals in the sector put forward several requests to the European authorities:

• Taking economic realities into account: factoring in the economic impact of the measures in each country, so as not to weaken a sector that remains significant for a number of national economies.
• Recognising local circumstances: allowing for the differences between countries (living standards, national contexts) instead of a uniform approach that would be ill-suited to some member states.
• Tackling trafficking: making the fight against the illicit market a priority. The sector fears that an excessive increase in taxes would encourage cross-border purchases and criminal trade, to the detriment of public health and of member states’ tax revenue.

Risks identified: parallel market and economic impact

The tobacco sector warns Brussels against the perverse effects of overly severe regulation. On the one hand, it argues, sharp excise increases risk feeding the parallel market rather than reducing smoking. The signatories point out that in 2024, more than 52 billion illicit cigarettes were consumed in Europe. An abrupt alignment of taxes at European level would, in their view, be a historic windfall for criminal networks while depriving governments of essential means of control.

On the other hand, the sector anticipates an economic shock for the legal trade. Overly heavy taxation would durably weaken the official players in the sector, they say, leading to job losses and even, paradoxically, to a fall in tax revenue for member states. Such measures would also penalise lower-income countries and households, and risk pushing smokers towards unofficial channels.

In the light of these warnings, the European tobacco sector is calling for constructive dialogue with the EU authorities. Its stated objective is to reconcile innovation and economic growth in the sector with the public health goals pursued by the EU, in the interest of tobacco regulation that is both effective and workable.

Sources: EU Reporter; Euronews; La Santé Publique; KPMG 2024 report