Inclusion of Novel Tobacco and Nicotine Products

The implementation of the European Beating Cancer Plan continues to progress. After several delays, the European Commission is now taking action on tobacco regulation — with an ambitious goal: under the Beating Cancer Plan, a “tobacco-free generation” is to be achieved by 2040, meaning that fewer than five percent of the population will still use tobacco.

Updating to Reflect Market and Consumption Trends

Tobacco consumption remains the leading cause of preventable diseases and deaths in the EU. According to estimates from the World Health Organization (WHO), more than 1.2 million people die each year in the European Region from tobacco-related illnesses.

To counter this, the European Commission presented on 16 July 2025 a package of measures to revise the EU Tobacco Tax Directive (2011/64/EU) and the Directive on the General Arrangements for Excise Duty (2020/262/EU). The aim is to update the taxation rules for tobacco products and align them with new market and consumption trends. The current directive was last revised in 2011. Since then, the market has changed fundamentally: today, numerous new products are available, especially nicotine-containing and nicotine-free e-cigarettes (“vapes”), which did not even exist at the time.

The Tobacco Tax Directive sets harmonized minimum rates for processed tobacco products. Member States remain free to apply higher national rates. The Commission’s proposal seeks, in particular, to extend the scope to novel tobacco and nicotine products, such as e-liquids, heated tobacco, nicotine pouches, and raw tobacco, and to close existing regulatory gaps.

Fiscal Measures Are Effective

In its opinion, the German Social Insurance (DSV) welcomes the European Commission’s initiative. Fiscal measures have proven to be one of the most effective tools for reducing tobacco consumption: according to WHO, a 10 percent price increase in industrialized countries leads to a reduction in tobacco use of about 4 percent — and even more among young people. Furthermore, international studies show that lower-income groups benefit disproportionately from the health effects. Raising the minimum tax rates is therefore an important step to reduce price loopholes between Member States.

Regulation of E-Cigarettes and Vapes

Including novel tobacco and nicotine products is an overdue and very positive step, particularly to better protect beginners and young people. The DSV explicitly welcomes that the Commission’s proposal closes a regulatory gap and makes a significant contribution to health and youth protection.

E-cigarettes and heated tobacco products must not serve as low-cost entry products for young people. The use of e-cigarettes among adolescents is far from rare: a WHO study shows that e-cigarette use among young people in Europe has increased sharply and that they are now more popular than conventional cigarettes. The nicotine content is often significantly higher than in traditional cigarettes: e-cigarettes typically contain between 3 and 36 mg/ml of nicotine, and a single pod, a small, prefilled cartridge, can contain as much nicotine as a pack of 20 regular cigarettes.

Untapped Potential for Further Action

At the same time, the DSV sees room for further improvement, both within the directive and beyond: minimum tax rates should be reviewed annually, not only every three years, to better reflect price and income developments. A stronger consideration of purchasing power parity (PPP) could also help to maintain the intended fiscal impact.

Beyond taxation, other measures should be used. The DSV advocates an EU-wide ban on advertising and marketing for novel products such as e-cigarettes and nicotine pouches, which are often promoted to young people via social media and lifestyle campaigns. A strict ban on flavorings is equally necessary, as fruit and candy flavors are among the main reasons for the attractiveness of these products to youth. Finally, standardized plain packaging should become mandatory across the EU. Uniform packs without logos or eye-catching designs have proven to be an effective means to reduce consumption — especially among young people — and to neutralize the promotional effect of packaging.

Next Steps

The Commission proposal will now be discussed in the Council and the European Parliament. The DSV’s full statement can be found here.