Heintz van Landewyck, a major tobacco and cigarette manufacturer, has warned that a planned EU minimum tobacco tax could inadvertently benefit the black market.
A compromise reached on Monday among 26 EU member states, including Luxembourg, proposes a progressive 25% increase in tobacco excise taxes by 2036. Charel Lemmer, general manager of Landewyck for German-speaking regions, described this revised framework as "tolerable" compared to the initial proposal, which he labelled a "horror scenario." The original plan would have based taxation solely on a country's purchasing power, a metric Lemmer noted would have resulted in minimum tobacco tax rates in Luxembourg being 40% higher than in other European countries.
Despite the revised proposal, Lemmer warned that any tax increase acts as a "stimulus package for criminal organisations." He pointed to neighbouring Belgium, where he suggested authorities uncover "an average of one illegal cigarette factory per month." Lemmer believes Luxembourg is similarly affected, citing a major tobacco seizure in Eschweiler in May 2025.
Under the proposed framework – which also covers nicotine pouches and electronic cigarettes – Luxembourg has agreed to reduce the export limit on tobacco products for personal consumption from four cartons per person to one. Finance Minister Gilles Roth told RTL Radio on Tuesday morning that this concession was intended as a gesture of goodwill toward France.
Lemmer criticised the reduction as an unjustified restriction on the EU single market. He drew a sharp comparison to France, arguing it is highly unlikely the country would propose limiting individuals to carrying just a single bottle of French wine across the border.
Although 26 member states reached an agreement on Monday, Malta vetoed the proposal, meaning negotiations must continue. Despite the setback, Minister Roth expressed confidence that a solution will be reached before the end of the year.
