Subject: British American Tobacco’s submission to the consultation on the European Commission’s proposal for revising the EU Tobacco Excise Directive
From: "Donatas Laurinavicius" <[email-masked]>
To: "Info - RAM" <[email-masked]>
Cc: <[email-masked]>
Date: Wed, 12 Nov 2025 15:32:01 +0200

Tähelepanu! Tegemist on välisvõrgust saabunud kirjaga.
Tundmatu saatja korral palume linke ja faile mitte avada.

Dear Sir or Madam

I am writing to share with you, and your colleagues at Estonian Ministry of 
Finance, British American Tobacco’s submission to the consultation on the 
European Commission’s proposal for revising the EU Tobacco Excise Directive.

As you know, the Commission adopted a proposal for a revision of the EU 
Tobacco Excise Directive on 16th July 2025.

We consider there are, however, some important flaws in the proposal.

Fundamentally, the Commission’s proposal would significantly infringe on the 
sovereignty of Member States to retain the right to set taxes as they see 
fit in their own countries in several areas.

The Treaties of the European Union make it clear that EU level intervention 
in matters relating to taxation is justified only if it is needed to ensure 
the proper functioning of the Internal Market and avoid distortions of 
competition arising from differences in national tax rules.

The Commission’s proposal goes well beyond this.

We wholly agree that novel, non-combustible, products should be brought into 
the scope of the Directive. But, several countries would be forced to 
substantially increase their current excise duties on these products.  And 
others would be compelled to move from a simple tax structure to a more 
complicated one.

Importantly, the Commission’s proposal does not reflect the reduced risk 
associated with the consumption of such products when compared to 
combustible tobacco, such as traditional cigarettes.  Heated tobacco, 
e-cigarettes and nicotine pouches are all already playing an important role 
in switching consumers to products that are less harmful than traditional 
cigarettes and fine cut tobacco.  And they have the potential to do much 
more.  We believe the tax treatment of these products should reflect this, 
and be proportionate to their reduced risk levels.

Another area in which the proposal to amend the Directive risks undermining 
Member States’ fiscal sovereignty is in the proposal to delegate powers to 
the Commission under Article 12(5) of the Directive are excessive.  This 
would substantially take future taxation decisions out of the hands of 
national governments in the EU.  We suggest that the delegated powers to the 
Commission should, preferably, be deleted entirely.  Alternatively, they 
ought to be limited to cover no more than non-essential elements of the 
Directive (such as inflation adjustments mechanism only) in line with 
Article 290 of the Treaty on the Functioning of the European Union.

Critically, Member States must be allowed to preserve the flexibility to 
tailor excise policies according to their national contexts and priorities. 
We would, consequently, be grateful if you could consider these issues 
during your forthcoming discussions on revisions to the Commission’s current 
proposals.

If you would like to discuss any of the points covered in our submission, or 
require any further information, please do not hesitate to let me know.

Yours sincerely,

Donatas Laurinavičius

Regulatory Engagement Manager Baltics

mobile: +370 644 44500

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