Europe’s Beating Cancer Plan, the European Commission’s ambitious policy to combat cancer, included amongst its action plans the raising of excise duties on tobacco and related products through revising the EU’s Tobacco Taxation Directive (TTD). Taxation remains the most effective tool for discouraging tobacco and nicotine consumption, yet the proposal to revise the TTD has been put on hold indefinitely.
This is the story of how falsehoods spread by the tobacco industry delayed the release of a key piece of European tobacco control legislation.
Snus-gate
The Commission’s proposal to revise the TTD was originally slated fir December 7, 2022.
On the eve of its release, things took a turn for the bizarre.
The Swedish tabloid Aftonbladet published a story on 26 November claiming that a leaked version of the soon-to-be-released proposal planned to tax snus, a popular oral tobacco product in Sweden but illegal elsewhere in the EU.
The news caused a fierce public uproar in Sweden, with many Swedes online threatening “Swexit” (a Swedish exit from the EU). The day after the article was published, Swedish Finance Minister Elisabeth Svantesson came out on Twitter to condemn the “unreasonable proposition,” vowing to “stand up for Swedish snus.”
Swedish Commissioner for Home Affairs Ylva Johansson also spoke with her colleague responsible for the proposal, Commissioner Paolo Gentiloni, to explain why taxing snus is inappropriate.
This controversy forced the Commission spokesperson for tax matters to reassure that there is no plan to tax Swedish snus as it falls outside the EU’s jurisdiction. “Our proposal won’t change this as snus is illegal outside Sweden,” the spokesperson insisted.
In other words, Aftonbladet’s story was a complete falsehood.
Yet the damage was already done. On 27 November, Commissioner Johansson declared that the proposal was not ready and its release would likely be postponed to 2023 when Sweden holds the presidency of the Council of the European Union. 3 days later, the Commission officially postponed the proposal.
The Swedish Connection
When Sweden took over the Council Presidency in January 2023, hopes for the proposal’s release were squashed when Minister Svantesson, now president of the Economic and Financial Affairs Council, bluntly stated that the TTD proposal was not scheduled for the term of the Swedish Council presidency.
In the months that followed, Swedish MEPs actively campaigned to promote oral tobacco and nicotine products by championing the narrative of the “Swedish experience”, i.e. the unsubstantiated claim that Sweden has the lowest rates of smoking-related mortality in Europe thanks to the popularity of snus and nicotine pouches (effective tobacco control policies are the likelier culprit). One MEP even so far as to place an “oral tobacco expert” on a panel for cancer prevention at the European Parliament. In parallel, these MEPs held closed-door meetings with tobacco industry lobbyists, some of whom had the declared objective of discussing the delayed tax proposal.
It was then reported in mid-June that Sweden was actively holding up the release of the TTD proposal due to fears of a tax on snus. It remains to be seen if the text will be released before European elections in June 2024 put all legislative files on hold.
White snus
Clearly, the indefinite delay of the TTD is due to concerns over the taxation of Swedish snus. Yet how valid are these concerns?
In 1992, the European Union banned all oral tobacco products, including snus, due to concerns over its use by adolescents. In 1995, Sweden was granted a derogation in its Accession Treaty to the European Union that permitted the sale of snus within its territory. Hence, the taxation of snus falls outside the EU’s jurisdiction.
But then why is Sweden still making such a fuss about snus?
Stockholm’s true worries may lie not in its much-beloved snus, but rather in another product promoted as an ingredient of the “Swedish Experience”: nicotine pouches.
Also known as white snus, these tobacco-less pouches were first introduced in 2015 by Swedish oral tobacco giant Swedish Match through its ZYN brand. Unlike snus, nicotine pouches are not covered by the European ban on oral tobacco products and therefore can be regulated and taxed.
Demand has exploded in recent years due to its popularity amongst youths. The global nicotine pouch market has been projected to grow to €16 billion by 2029, at a 35.8% annual growth rate.
This is also a market that is dominated by Swedish manufacturers. Out of the top 27 nicotine pouch manufacturers, 18 are Swedish, with Swedish Match being the biggest. In Sweden, nicotine pouches receive extremely favourable fiscal treatment, being taxed at a mere 10% of the rate of e-cigarette liquids and roll-your-own tobacco (€17/kg).
This is not the only preferential treatment nicotine pouch makers receive. Earlier this year, Sweden’s second-largest oral tobacco and nicotine manufacturer received the Food Exporter of the Year award from the Swedish Ministry of Rural Affairs and Infrastructure.
“The Swedish government listens far too much to the tobacco industry,” observes Annette Jansson, Policy Expert at the Swedish Heart and Lung Foundation. “The industry has successfully convinced many in government that snus and nicotine products reduce smoking prevalence and smoking-related illnesses.”
A snus-tale
Nevertheless, nicotine pouches are receiving the cold shoulder outside their native Sweden. The product currently faces bans in several Member States. Brussels also has it within its sights, as shown by the leaked TTD proposal which included a minimum €120/kg excise duty for nicotine pouches.
If adopted, this tax would no doubt trigger the adoption of much higher taxes in certain Member States, in the same way as the current TTD did. It could also provide an example for third countries that have already introduced tobacco taxes modelled on the EU’s.
It is therefore likely that the Swedish tobacco industry is concerned by the possible “spill-over” effects of the tax on nicotine pouches by the revised TTD. However, the difficulty of mobilizing political support for a relatively novel consumer item meant that the industry and its surrogates had to find a different avenue to push its agenda.
And what better candidate than snus, a product that has acquired a national symbolic status since its invention in the 17th century? It is popular across Swedish society, with one in five Swedish men using it daily. Commissioner Johansson has been reported to chew snus “as if it’s a pack of mints,” while Swedish Prime Minister Ulf Kristersson has voiced his preference for Göteborgs Rapé, a brand of snus made by Swedish Match.
No wonder then the industry and its allies are choosing to rally behind snus to push against taxation on oral tobacco and nicotine products. It allows for politicization of the taxation of oral nicotine products as an issue of “sovereignty” and “self-determinism”, a clever ruse that disguises the true commercial motivations for delaying the TTD.
In the words of one Swedish MEP, “if we could open up a European market with 100 million adult smokers…it is hard to see that it would not be a new Swedish export success…”
It should therefore come as no surprise that the tabloid article at the centre of “snus-gate” cited Swedish Match’s Vice President of Communications and Public Affairs, Patrik Hildingsson, as a primary source. Hildingsson was amongst those responsible for successfully lobbying the Food and Drug Administration (FDA) to change the warning labels on Swedish Match’s General Snus in the United States, mainly through exploiting the narrative of the “Swedish Experience.”
Industry falsehoods aimed at provoking public backlash against regulation is nothing new. Back in 2013 when the European Parliament was deciding whether to regulate e-cigarettes as medical products, limiting its sales to a “on-prescription” basis, false rumours were spread by companies and trade associations that a total ban on e-cigarettes was being discussed.
This triggered a fierce public furore, with e-cigarette users across the continent mobilizing against the measure. Their efforts were ultimately successful in pressuring enough MEPs to vote against regulating e-cigarettes as medical products.
When questioned on their motives, e-cigarette industry insiders admitted to fears that if passed, the proposed text would have served as a precedent for hardened regulation of e-cigarettes around the world.
Although “snus-gate” did not provoke a public reaction as fierce as the false rumours of an e-cigarette ban, it nonetheless created enough controversy to delay a key European legislative proposal. And there is always the possibility of the “unjust tax on snus” narrative being exploited later on to mobilise further public opposition against the TTD.
If you snus, you lose
What is truly worrisome is not the industry’s effective postponement of a key European legislation, but rather its success in convincing young consumers to get hooked on nicotine pouches. Despite a current lack of European-wide data, anecdotal evidence is pointing to a rise in the popularity of nicotine pouches amongst adolescents and young adults.
More and more young people are being seduced by their flavourful varieties (bubblegum, cola, tropical breeze…), discrete ease of use and false impressions of “reduced health risks.” Yet these pouches can deliver up to 130mg more nicotine than traditional cigarettes.
What is largely unbeknownst to many is the harmful health effects of nicotine itself. The substance has been found to increase blood pressure, heart rate, blood clot formation, blood vessel stiffness, vascular damage and the narrowing of airways. Long term nicotine consumption can therefore lead to a higher risk of heart attack, stroke, and chronic obstructive pulmonary diseases.
Regular nicotine use has also been linked to worsened anxiety and depression, as well as sleeping problems, impaired impulse control, impaired memory, attention deficit and mood swings.
“Europe needs to be aware of the consequences of promoting alternative nicotine and tobacco products with lower tax and relaxed regulation,” warns Annette Jansson. “The narratives spun by the tobacco industry are ultimately aimed at creating a new generation of nicotine addicts. The only winners are the tobacco industry, and the losers are our young people.”
