Luxembourg: the price of a pack of cigarettes could increase by €3.50

As Luxembourg considers a significant increase in tobacco prices—up to 60 % according to some scenarios—this measure would be a major step forward for public health at the European level. By reducing price gaps with France, it could help curb cross-border tobacco trade and improve the health situation in border regions, particularly the Grand Est region, which is particularly affected by higher smoking prevalence. This prospect also counters the tobacco industry's narratives about parallel markets, which are often exaggerated to block tax increases.

A decision expected in Luxembourg

The increase in tobacco prices in Luxembourg, mentioned in recent days in several Luxembourg and French media outlets, is part of the European Commission's review of the directive on the taxation of tobacco products. The objective: to further harmonize taxation levels between Member States and reduce price distortions that encourage cross-border purchases.[1].

Luxembourg, known for its very low prices on tobacco products, is among the countries most directly affected by this reform. According to initial estimates reported by the press, the price of a pack of cigarettes could increase by €3.50, an increase of approximately €60 billion, which would constitute a major shift in the Grand Duchy's tobacco tax policy. This prospect would be in line with the recommendations of the World Health Organization, which advocates high taxation as a tool for reducing tobacco consumption.

For public health associations, this measure would constitute a major step towards more coherent taxation within the European Union, strengthening the effectiveness of national health policies. By reducing the attractiveness of Luxembourg tobacco, it would simultaneously reduce cross-border purchases, protect vulnerable populations, and strengthen French tax policies, particularly in the border regions of the Grand Est region.

A lever for public health and finances

Every year, millions of packs of cigarettes are purchased outside France, primarily in neighboring countries where taxation is more favorable. This phenomenon, known as "tobacco tax tourism," partially undermines the effectiveness of public health policies based on price increases, which are recognized as one of the most effective ways to reduce smoking, particularly among young people and vulnerable populations.

Border regions such as the Grand Est region, where access to cheap tobacco is facilitated by their proximity to Luxembourg, are directly affected by this: they have a higher smoking prevalence than the national average, exacerbating regional health inequalities. Economically, this European-wide tax reform would also better secure French tax revenues by reducing losses related to these purchases outside the country.

A response to tobacco industry misinformation

The announcement of a possible increase in tobacco prices in Luxembourg also represents a clear response to the alarmist rhetoric of the tobacco industry, which systematically cites the growth of parallel trade to oppose tax increases. These arguments, widely relayed by firms funded by cigarette companies, are aimed at curbing effective public policies to combat smoking.

The National Committee against Smoking (CNCT)[2] also recalls that the scale of cross-border purchases is directly the result of the over-supply of these markets by tobacco manufacturers. The latter deliver volumes to Luxembourg that are far greater than the needs of the national market, directly supplying markets parallel to that of tobacconists in France. Thus, in 2023, according to the own data from KPMG reports carried out for the cigarette manufacturer Philip Morris, 4.34 billion cigarettes were sold in Luxembourg, or more than 18 cigarettes per day per inhabitant. The CNCT deplores the fact that the tracking and tracing system set up at European level is not independent of cigarette manufacturers and that the data concerning this over-supply of border markets is not made public even though it would demonstrate the responsibility of cigarette manufacturers in this area.

The CNCT finally emphasizes that this practice of over-supply goes against the WHO Protocol to Eliminate Illicit Trade, ratified by the European Union, which provides for supply quotas based on domestic consumption.

In this context, it appears that, contrary to the recurring discourse concerning parallel markets, tax increases associated with effective measures to combat the practices of tobacco manufacturers go hand in hand with an improvement in public health, an increase in tax revenues and a reduction in parallel markets.

©Generation Without Tobacco

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[1] Fabrice Barbian, Luxembourg: Will the price of a packet of cigarettes increase sharply? ?, La Semaine, published July 4, 2025, accessed July 8, 2025

[2] Press release, Parallel tobacco markets: the tobacco industry persists in spreading misinformation, CNCT, published June 11, 2025, consulted July 8, 2025