Global

Details

  • Service: Tax, Global Indirect Tax, Global Compliance Management Services
  • Type: Regulatory update
  • Date: 6/22/2012

Portugal - EC finds excise tax rules for cigarettes "disproportionate" 

June 22:   The European Commission (EC) has officially asked Portugal to change its excise tax (duty) rules related to the marketing of cigarettes.

The Portuguese sales-and-marketing prohibition establishes a time limit for the sale of cigarettes, linked to the fiscal stamp on the packaging. Cigarettes cannot be sold any later than three months after the end of the year that they are released for consumption.


Under EU law (Directive 2008/118/EC [PDF 120 KB]), excise tax on tobacco products must be charged at the rate applicable on the date on which they are released for consumption. There is no provision under EU law that allows EU Member States to add supplementary duty to this release-date tax rate, or to limit the distribution of tobacco products for fiscal reasons.


According to an EC press release (IP/12/675, June 21, 2012), the Portuguese sales-and-marketing prohibition is “disproportionate” to any fraud-tackling objective and is contrary to the provisions of Directive 2008/118/EC.


The EC's request takes the form of a reasoned opinion (the second step of EU infringement proceedings). If Portugal does not bring its rules into compliance within two months, the EC may refer the matter to the European Court of Justice.




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