The Commission will propose an EU-wide levy on tobacco products such as cigarettes and cigars. These goods are currently being taxed by individual countries, who keep the revenues for themselves.
The EU’s idea comes amid a push to introduce new taxes on e-cigarettes and vapes that are opposed by Italy, Greece and Romania.
While not opposing the proposed new taxes, Sweden said that handing part of its national revenues to the EU is “completely unacceptable.”
The Commission also suggests taxing discarded electrical equipment.
Wednesday’s proposal is expected to also confirm proposals from 2021 to levy a carbon border tax ― a popular idea among countries ― and a take share of the revenues generated by the emissions trading scheme (ETS).
This idea is politically sensitive among Eastern European countries who are most affected by ETS.
In a concession to critics, the Commission suggested that only a small share of ETS revenues will flow to the EU budget, while the rest would stay with national governments. It added that a controversial plan to extend the scheme to buildings and road transport ― known as ETS2, which will come into force in 2027 ― won’t be funneled into the EU budget.
National governments will have to unanimously approve the new taxes over two years of fraught negotiations that will start after the Commission makes its proposal.