Smokers will have to pay more to the tax authorities in the coming years. In the years 2022 and 2023, the tobacco tax on a pack of 20 classic cigarettes will increase by an average of ten cents each, after a one-year break it will be another 15 cents more expensive in 2025 and 2026. This provides for the tobacco tax reform that passed the Federal Council on Friday and is thus complete. A pack of branded cigarettes currently costs around seven euros, and manufacturers are likely to pass the higher taxes on to end customers. The tobacco tax was last raised in 2015.
It is estimated that around one in four adults uses a cigarette regularly – despite the high health risk. The German Cancer Research Center, for example, does not expect a significant effect until a tax increase of ten percent – only then would many smokers quit because of the higher price. The tobacco tax is an important source of income for the tax authorities, last year it brought in 14.7 billion euros. This value is expected to increase significantly in the future. Without a tax increase, the federal government had forecast tobacco tax revenues of 14.1 billion euros for 2022, and with the rules now adopted, it expects almost 16 billion euros.
But the legislature does not raise prices most strongly for cigarettes: water pipe tobacco for hookahs, sticks for tobacco heaters and liquids for e-cigarettes are taxed much more heavily. The reform part was controversial, after all, these products contain far fewer harmful substances than tobacco cigarettes. However, there are currently no long-term studies on e-cigarettes and tobacco heaters – so it is unclear how harmful they are in the long term. Reform proponents like the SPD politician Michael Schrodi reject the criticism. Novel tobacco products have so far only been taxed very low. “Now they are being taxed appropriately because they too are a health hazard and are potentially addictive.”