The Portuguese government formally expressed significant reservations regarding the European Commission’s dual tobacco-related proposals, joining Greece, Italy, and Romania in opposing measures Lisbon claims could cost its treasury €1.5 billion, according to Euractiv.
The objections target both the Commission’s revision of the Tobacco Taxation Directive (TTD) and its inclusion of a new 15% Tobacco Excise Duty Own Resource (TEDOR) within the €2 trillion budget framework for 2028–2034.
“Naturally, [this] cannot be accepted under the current conditions,” Portuguese officials stated, highlighting the substantial projected loss of national tax revenue if the TEDOR levy proceed as drafted. This position underscores deepening fissures between member states and Brussels over fiscal harmonisation policies impacting sovereign taxation rights.
Lisbon’s objections extend beyond pure fiscal concerns to fundamental disagreements over public health strategy. The proposed TTD revision mandates sharp tax increases across all tobacco products, with data obtained by Euractiv indicating a projected €1.22 per pack increase for cigarettes in Portugal.
The directive places alternative products, including electronic cigarettes, heated tobacco, and nicotine pouches, under equivalent taxation structures as conventional cigarettes.
“Portugal has reservations about applying equal taxation to cigarettes and other forms of smoking that are less harmful to health,” the government asserted.
Advocating a differentiated approach, the Portuguese officials argued that “since taxes are a form of disincentive, we believe that less harmful forms of smoking should be subject to lower taxes to encourage smokers to switch to these products.”
This stance directly challenges the EU’s alignment with the World Health Organisation position that “less harmful” tobacco alternatives remain intrinsically harmful and warrant equivalent fiscal discouragement.
Simultaneously, Lisbon warned that disproportionate tax hikes risk stimulating illicit tobacco markets, citing experiences elsewhere in the bloc. The Commission, however, maintains that price alignment through uniformly elevated taxes will conversely diminish cross-border smuggling by reducing price differentials between member states.
