Tobacco Tax Increases Around the World– Summer 2025 Update

Thus far, 2025 has been a challenging year for governments fiscally, with economic instability and budgetary shortfalls experienced around the world, most notably to support health and education programs. Health taxes—and especially tobacco taxes—provide an opportunity for policy makers to improve the health of the population, as well as to raise much-needed revenues. Decades of evidence demonstrate the untapped potential of effective tobacco taxes for countries relative to current best practices. High taxes and a simple tax structure, along with regular adjustments to outpace the combination of inflation and real income growth, will reduce affordability over time, discourage tobacco consumption and decrease the burden of tobacco-related disease.

Looking back at the summer season, we are hopeful with some progress on tobacco taxes in countries, and active deliberation on tax reform in others. In this blog, we highlight improvements in tobacco tax policy in 14 countries across five WHO regions, continuing our blog series on the topic.

Africa

The 2025-26 National Budget in Mauritius increased the excise tax on tobacco products by 10%, effective June 6. The budget also included excise tax increases on alcohol and sugar-sweetened beverages. In Uganda, the annual budget doubled the excise tax on imported cigarettes, to SHS 3,000 for a soft cap pack and SHS 4,000 for a hinge lid pack. Cigarettes manufactured in the East African Community faced moderate tax increases, from SHS 1,100 to SHS 1,300 for a soft cap pack and from SHS 1,600 to SHS 1,800 for a hinge lid pack. This change, effective July 1, is the country’s first substantial tobacco tax increase in six years. The government should, however, move as quickly as possible toward a uniform specific tax because domestically produced cigarettes are just as deadly as imported ones. Senegal’s Prime Minister released an economy recovery plan which includes raising tobacco taxes from 70% to 100% to raise revenues in response to the country’s looming debt. A more effective tax structure would include a significant specific excise tax component, and an immediate improvement would be to change the base of the ad valorem tax from the wholesale prices to the retail ones.

Eastern Mediterranean

In Egypt, cigarette taxes were increased by 50 piasters per pack effective July 1. Policy makers also increased the thresholds for cigarette prices in each tier, with additional annual increases of 12% planned for November 2025, 2026, and 2027. The Ministry of Finance aims to raise an additional EGP 15.3 billion in tobacco tax revenue in FY 2025-26 compared to the previous fiscal year. Egypt could quickly improve their tobacco taxes by adopting a uniform specific tax instead of the current structure which is tiered.

Europe

On July 1, Croatia passed comprehensive legislation raising the excise duty on cigarettes and other tobacco products. The specific tax on cigarettes increased from EUR 53.10 to EUR 56.10 per 1,000 sticks, with the minimum excise tax up from EUR 117.87 to EUR 124.20 per 1,000 sticks. Fine-cut tobacco taxes increased to EUR 120.50 per kilogram, and cigar and cigarillo taxes increased to EUR 120.50 per 1,000 pieces. The excise tax on HTP, meanwhile, increased from EUR 185.82 to EUR 198.50 per kilogram, and new tobacco products also face a tax increase, from EUR 114.15 to EUR 120.50 per kilogram. The government also introduced a new excise tax on e-liquids, set at EUR 0.20 per milliliter. The Ministry of Finance estimates that these changes will increase tax revenue collection by EUR 74.7 million. In Kazakhstan, the Ministry of Finance raised the minimum price of a cigarette pack from KZT 820 to 920, with additional increases planned for January. The government also approved a new 10% excise tax on luxury goods, which will apply to cigarettes with prices higher than KZT 10,000 per pack, beginning next year. On July 1, Poland’s Excise Duty Act came into effect, including a new excise tax of PLN 40 on e-cigarette devices, adding to the existing tax on e-liquids. In August, the country increased the excise tax on nicotine pouches and other nicotine products to PLN 150 per kilogram. Poland’s new regulation also requires the use of tax stamps on e-cigarette devices and e-liquids, with a transitional period for compliance through April 2026. In Serbia on August 1, the minimum excise tax on cigarettes increased from RSD 233.36 to 235.11 per pack, and the minimum for rolling tobacco and pipe tobacco increased from RSD 8,167.60 to 8,228.85. These amendments were passed in February, as part of the broader aim to harmonize with the European Union’s tax policies. Finally, Turkey updated the Special Consumption Tax for inflation, thus raising cigarette pack prices between TRY 5 and 8.

South-East Asia

The Excise Tax Bill of 2025 in Bhutan raised excise taxes on cigarettes and biris to BTN 10 per stick and cigars to BTN 40 per cigar. For chewing tobacco, excise taxes increased to BTN 1,500 per kilogram and the proposed selling price increased from BTN 0.20 to 0.33 per 10 grams. E-cigarette devices and refill tobacco face a 100% ad valorem tax. The legislation also increased excise taxes on alcoholic beverages, as part of the broader efforts to protect public health. The Committee on Public Finance in Sri Lanka approved a tax increase on locally produced bidi, from LKR 2 to 3 per stick, to meet tax revenue targets. In Viet Nam, the National Assembly passed the Law on Special Consumption Tax, transitioning from an ad valorem excise structure to a mixed one. The ad valorem rate on a pack of cigarettes will be 75% and the specific component will be VND 2,000 beginning in 2027, with annual increases planned through 2031. Furthermore, the ad valorem tax on alcohol will be raised and a sugar-sweetened beverage excise tax will be introduced in 2027.

Western Pacific

Cigarette excise taxes increased by 6.8% in Australia on September 1, as part of the scheduled biannual tax increase, thus raising the price of a pack of cigarettes from AUD 28.06 to 29.97. Malaysia, the Prime Minister expanded health taxes beyond just sugar-sweetened beverages, to cover tobacco and alcohol in the 13th Malaysia Plan. The specific rates will be established in the next budget, which is coming in October.

These examples highlight the steps that leaders are taking to improve tobacco tax policies. Many countries are also thinking beyond just cigarette taxes and are applying excise taxes to other nicotine and tobacco products. Similarly, there has been a push for coordinated health taxes—which include tobacco, alcohol, and sugar-sweetened beverages—to reduce overall consumption of unhealthy products and the burden of diseases.

Unfortunately, most of the changes noted above are incremental and much of the world still has a significant way to go to implement best practices in tobacco taxation. Still, we are encouraged by these advancements, alongside the ongoing tax reform discussions in countries like Brazil and Mexico. We hope to see more policy makers follow suit in the future, utilizing tobacco taxes to reap substantial fiscal and public health benefits for their citizens.

 Stay tuned for the upcoming release of the 4^th edition of our Cigarette Tax Scorecard, which uses the latest data to assess current cigarette tax policies in 171 countries, to learn more.