The European cigar industry has received better news than expected from Germany, one of the largest markets on the continent. According to the German press, especially the daily Bild, the governing coalition parties have agreed a softened version of the tobacco tax increase proposed by the Finance Ministry over the summer.
For cigars, the percentage component of the tax would rise from 1.74% to 3.83% of the retail price, compared with the 21.05% set out in the original proposal, roughly a 14-fold increase. For pipe tobacco, the tax would reach €71.50 per kilogram by 2030, up from about €26 today, instead of the proposed €172.
Cigarettes remain the hardest hit: the increases would take effect in four steps, on 1 January 2027, 2028, 2029 and 2030, and a pack could cost about €9.10 in 2027 and nearly €12 in 2030. The government expects about €11.6 billion in additional revenue by 2030.
The law has not yet been adopted: the Bundestag still has to vote on it, and the details of the minimum taxes for cigars are not yet clear.
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Source: halfwheel