The Portuguese government has proposed tax increases on tobacco and e-cigarettes in its 2024 State Budget, aiming to generate €176.6 million in revenue. The plan introduces taxation on nicotine-free electronic cigarettes and restructures duties based on nicotine levels rather than retail prices.
According to the budget document, taxing nicotine-free e-cigarettes addresses the rapid growth of these products in Portugal. The government views these devices as a gateway to smoking habits for new consumers and a public health risk due to a lack of regulatory control.
The policy also targets cheaper alternatives, such as cigarillos and rolling tobacco, which appeal to younger demographics. Under the new rules, these products will face higher tax burdens to reduce their affordability.
If manufacturers pass the tax increases on to consumers, the price of a standard pack of cigarettes will rise by 30 to 40 cents. Cigarillos, which currently retail for around €2.50 to €3.00, could double in price.
| Product Type | New Tax Rate / Price Impact |
|---|---|
| Cigarette Pack | Increase of €0.30 to €0.40 per pack |
| Cigarillos | Retail prices expected to double |
| Flavored E-liquids (Nicotine-Free) | 12.5% tax rate |
| Nicotine-Containing E-liquids | 25% tax rate |
| Vapor (Heated Liquid) | 50% tax rate |
| Rolling Tobacco | 75% of the tax levied on standard cigarettes |
For electronic cigarettes, flavored liquids will carry a 12.5% tax, rising to 25% if the liquids contain nicotine. The vapor produced by battery-heated liquids will face a 50% tax rate, while rolling tobacco will be taxed at 75% of the rate applied to standard cigarettes.
