Will the EU take a leaf out of its local weather change laws to affect tobacco coverage?

Photo: Pixabay / marcinjozwiak

The European Commission has published its much-anticipated “Fit for 55” package as part of the European Green Deal. The comprehensive plan includes measures to reduce net greenhouse gas emissions by 55% by 2030 with a two-pronged strategy. The proposal includes the use of economic levers to redirect the bloc’s course in the direction of CO2 neutrality: on the one hand, raise the prices for CO2-intensive energies and, on the other, lower or subsidize the costs of more sustainable solutions.

This use of the tax powers available to the EU to shape public behavior towards the common good builds on the solid concept of the Tobacco Tax Directive. Since 2011, Europe-wide “sin taxes” on cigarettes have been an effective means of bringing about a change in behavior without downright bans on tobacco products. By being carbon neutral, the EU has adopted the same tactic in its climate plan to encourage the transition from carbon intensive activities and energy sources.

But while Brussels is happy to offer climate subsidies as a sweetener for European consumers and industries, the EU is now ironically moving in the opposite direction on smoking, crowding out less harmful alternatives for those trying to quit cigarettes.

Taxed for the privilege of burning coal and lighting cigarettes

The EU is a world leader when it comes to the “definition task of the generation” of rapid emission reduction. In view of the fact that carbon neutrality cannot happen overnight, the block’s action plan for carbon reduction contains a calculated balance of measures. At the heart of the package is an endeavor to increase the cost of greenhouse gas emissions when there are alternatives with lower emissions, including a border tax on high-carbon products from abroad, taxes on high-carbon aviation and marine fuel, and tariffs on certain imports from countries with lax climate rules .

Experience with block-wide excise duties on traditional cigarettes has impressively demonstrated the effectiveness of this type of tax policy. Much like the EU’s new green directives, which put a price on those who choose carbon-rich energy sources, tobacco taxes aim to tackle the dire health problems posed by tobacco by imposing tariffs on the quarter of Europeans who continue to smoke.

The Tobacco Tax Directive requires Member States to add at least 60% of the tax to the weighted average retail sales price of a pack of cigarettes (before VAT). According to an EU assessment of the Tobacco Tax Directive published last year, the average excise tax levied per thousand cigarettes in the bloc as a whole between 2010 and 2017 rose from € 113 to € 148.5 EU-wide a total of € 82 billion by 2016. Although the directive is the stated goal of the block of reducing the smoking rate by 10% in five years, the reduction in the first few years of its implementation still corresponded to seven million fewer smokers.

Remain open to alternative solutions

With “Fit for 55” the EU is going a step beyond the deterrent pattern of the Tobacco Tax Directive by openly pushing Europeans to alternative solutions with a lower carbon footprint.

To the extent that Europe’s climate action represents a fundamental shift for the bloc, phasing out new gasoline and diesel vehicles by 2035 is perhaps the biggest proposed adjustment. As a counterbalance to its new policy, the EU has set up a “Social Climate Fund” worth over 70 billion euros to “help citizens finance investments in energy efficiency, new heating and cooling systems and cleaner mobility”. This funding is not 100% carbon free as the EU has chosen to encourage the switch to electric vehicles, despite the carbon footprint associated with their production and polluting rechargeable batteries. Still, the long-term impact of these vehicles is far less than that of traditional internal combustion engines, so European politicians are more than willing to adopt electric vehicles to facilitate the green transition.

Brussels has so far refused to take a similar approach to tobacco regulation, even if its current approach to public health effects appears to have hit a wall; According to the 2020 Tobacco Tax Directive assessment, the bloc’s tax policy failed to significantly reduce smoking rates after 2014. As they consider revising the directive to include more novel products, EU leaders instead continue to insist that smokers either quit cold turkey or continue paying a heavy price for their nicotine addiction, whichever is Form that nicotine is present.

This has led proponents of harm reduction to warn European policymakers against going in a counterproductive direction if e-cigarettes and vaping devices are lumped together with tobacco products as part of the overhaul. This is because e-cigarettes are not only a step towards quitting for many, but also a less harmful substitute for those smokers who are struggling to completely give up their nicotine habit – half of current smokers in the EU have tried to stop and failed. Because most of the most harmful toxins in cigarettes are absent from vapes, a study by Public Health England found them to be “at least 95% less harmful than smoking”.

Proponents of harm reduction argue that a flat tax hike that treats vaping devices like cigarettes could actually hinder smoking cessation. The Tax Foundation writes that “the effectiveness of excise taxes on cigarettes increases when cheaper, less harmful substitutes are widely used”.

The EU’s open-minded approach to electric vehicles recognizes the need for alternative options to bring about lasting behavior change. Just as it is unreasonable for Europeans to give up driving, the EU revision of its tobacco tax directive could ultimately make a nicotine-free Europe appear unrealistic in the short term.

Ultimately, reducing the overall harm by offering safer alternatives to what is suffering – be it coal or cigarettes – could prove to be a more effective strategy for citizens to change public behavior.