^VN-W COMMISSION OF THE EUROPEAN COMMUNITIES 
C0M(92) 370 final 
Brussels, 24 September 1992 
Amended proposal for a 
COUNCIL DIRECTIVE 
on the approximation of taxes on cigarettes 
Amended proposal for a 
WUNCiUWtECmE 
on the approximation of taxes on manufactured tobacco 
other than cigarettes 
mv (presented by the Commission pursuant to Article 149(3) 
of the EEC Treaty) 
Pife',.: :.:-:** 
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EXPLANATORY MEMORANDUM 
On 6 Noveiber 1989 the Couission presented to the Council aiended proposals for Council Directives on 
the approximation of taxes on cigarettes and on the approxiiation of taxes on îanufactured tobacco other 
than cigarettes.1 
The Econoiic and Social Conittee gave its opinion on the proposals on 5 July 1990.2 
The European Parliament gave its opinion on 10 March 19923 on the basis of the report drawn up by the 
Comittee on Econoiic and Monetary Affairs and Industrial Policy. A total of 21 of the aiendients 
proposed in the report were adopted by Parliaient on that date. They are intended inter alia to ensure 
the iipleientation of a conversion prograne for the Couunity tobacco industry in certain regions, to 
fix an overall liniiui excise-duty level for cigarettes effective froi 1 January 1993, and to draw a 
distinction between fine-cut sioking tobacco and rough-cut sioking tobacco, etc. 
The Couission has taken up five of the aiendients adopted by Parliaient, although soie only in part. 
They are dealt with in these aiended proposals. 
The two lain reasons why the Couission could not accept a large proportion of the aiendients proposed 
were firstly because several of the aiendients were technically incoipatible with its proposal and 
secondly because several of the aiendients re-opened the arguient as to whether tobacco taxation should 
be predoiinantly specific or ad valoru*. The Couission does not consider it necessary for the 
coipletion of the internal îarket to re-open this debate. 
10J Ho C 12 of 18 January 1990, p. 4. 
20J Ho C 225 of 10 Septeiber 1990, p. 56. 
30J Ho C ..., , p. ... 
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AMENDED PROPOSAL FOR A COUNCIL DIRECTIVE 
ON THE APPROXIMATION 
OF TAXES ON CIGARETTES 
Ninth recital 
Whereas those diverse situations should be 
evened out; whereas, to that end, flexibility of 
those tax coiponents should be introduced in the 
fori of linimn rates in order to achieve an 
internal larket without frontiers at 
1 January 1993; Ninth recital 
Whereas those diverse situations should be 
evened out; whereas, to that end, starting with 
liniiui rates in order to achieve an internal 
•arket without frontiers at 1 January 1993, 
those tax coiponents should be approxiiated 
stage by stage with a view to achieving single 
target rates; 
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AMENDED PROPOSAL FOR A COUNCIL DIRECTIVE 
ON THE APPROXIMATION OF TAXES ON 
MANUFACTURED TOBACCO OTHER THAN CIGARETTES 
ORIGINAL PROPOSAL AMENDED PROPOSAL 
Article 1 
The following groups of hoie-produced and 
iiported lanufactured tobacco shall be subject, 
in each Meiber State, to an ad valorei excise 
duty calculated on the basis of the îaxiiui 
retail selling price of each product, freely 
deteriined by lanufacturers and iiporters in 
accordance with Article 5 of Directive 
72/464/EEC: 
(a) cigars and cigarillos; 
(b) sioking tobacco; 
(c) chewing tobacco; 
(d) snuff. 
Article 3(1) 
1. In the longer ten, each Meiber State shall 
apply a target ad valorei rate of excise duty in 
such a way that the total tax burden resulting 
froi the coibination of the excise duty and VAT 
is: 
for cigars and cigarillos: 361 
for sioking tobacco: 561 
for snuff and chewing tobacco: 43% Article 1 
unchanged 
(a) unchanged 
(b) sioking tobacco, including: 
1. fine-cut sioking tobacco; 
2. rough-cut sioking tobacco; 
(c) unchanged 
(d) unchanged 
Article 3(1) 
1. In the longer ten, each Meiber State shall 
apply an ad valorei rate of excise duty in such 
a way that the total tax burden resulting froi 
the coibination of the excise duty and VAT is: 
unchanged 
for fine-cut sioking tobacco: 561 
for rough-cut sioking tobacco: 381 
unchanged 
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of the retail selling price inclusive of all 
taxes. 
ORIGINAL PROPOSAL 
Article 3a(lï 
1. By 1 January 1993 at the latest, each Heiber 
State shall apply an ad valorei rate of excise 
duty in such a way that the total tax burden 
resulting froi the coibination of the excise duty 
and VAT is not less than : 
- for cigars and cigarillos : 251 
- for sioking tobacco : 50% of the retail selling price inclusive of all 
taxes 
AMENDED PROPOSAL 
Article 3a11) 
1. unchanged 
- unchanged 
- for fine-cut sioking tobacco : 501 
- for rough-cut sioking tobacco : 501 
- for snuff and chewing tobacco : 371 
of the retail selling price inclusive of all 
taxes. - unchanged 
of the retail selling price inclusive of all 
taxes. 
Article 4 
Every two years, and for the first tiie not later 
than 31 Deceiber 1994, the Council, acting on the 
basis of a report and, where appropriate, a 
proposal froi the Conission, shal exaiine the 
target rates of duty and the liniiui rates and 
shall, acting unaniiously, lake the necessary 
adjustients. Article 4 
Every two years, and for the first tiie not later 
than 31 Deceiber 1994, the Council, acting on the 
basis of a report and, where appropriate, a 
proposal froi the Conission, shall exaiine the 
provisions of this Directive. It shall, acting 
unaniiously and after consulting the European 
Parliaient, lake the necessary adjustients. 

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ISSN 0254-1475 
COM(92) 370 final 
DOCUMENTS 
EN 03 09 
Catalogue number : CB-CO-92-383-EN-C 
ISBN 92-77-47191-3 
Office for Official Publications of the European Communities 
L-2985 Luxembourg