The European Parliament economic affairs committee said on March 2 2009 that there should be a gradual increase in minimum tax rates on cigarettes, to at least 1.50 euro a pack by 2014.

The committee advocated smaller increases than those proposed by the European Commission.

The aim of the proposed legislation is to avoid distorting the single market and to foster tax convergence (tobacco tax rates currently differ from member state to member state), the committee said.

This should also help to protect health, if used in combination with a ban on tobacco advertising and with education campaigns, said the committee, in a report drafted by Zsolt Laszlo Becsey.
 
Convergence would be fostered by applying the same minimum requirement to cigarettes and other tobacco merchandise. The increases, if approved by the Council, would be introduced gradually, ending on January 2014.
 
The minimum tax on cigarettes should be 64 euro a 1000 cigarettes from January 2012 onwards, the committee said.

But from January 2014, the minimum tax should be 75 euro a 1000 cigarettes, less than the 90 euro proposed by the EC, the committee said.
 
This would make the minimum tax 1.50 euro a pack of 20 cigarettes from 2014.
 
The proposal also aims to bring minimum tax rates for fine-cut rolling tobacco into line with the rate for cigarettes. For this tobacco, the committee proposes minimum tax rates of 43 euro a kg from 2012 and 50 euro/kg from 2014 (for the latter step, the EC had proposed 60 euro/kg).
 
For cigars and cigarillos, the committee advocates minimum rates of 12 euro/kg from 2012 and 22 euro/kg from 2014.
 
The EC had proposed increasing the minimum rates in two steps, one from 2010 and the other from 2014, but the committee agreed on 2012 and 2014.
 
As is usual with taxation issues, the European Parliament's views are advisory rather than binding and the final decision is for the European Council, acting unanimously.