Germany should close a tax loophole that allows self-assembly cigarettes to be taxed at a lower rate than ready-made cigarettes, the legal adviser to the European Court of Justice said today.

The European Commission took Germany to court to force it to apply a tax totalling 57 per cent of the retail price to manufactured sticks of tobacco sold under the brand name West Single Packs. The brand, owned by Britain's Imperial Tobacco Group, is one of several self-rolled cigarettes sold in Germany and taxed at the lower rate of 36 per cent.
Advocate General Francis Jacobs said the court should rule that Germany was wrong to apply tax levels for loose tobacco to the manufactured sticks. He also recommended that Germany should pay the legal costs of the case.
The tobacco sticks are sold wrapped in a tube of aluminium foil that is inserted into a cigarette paper filter, and the foil is removed to assemble the cigarette. "There is a clear material distinction between tobacco already made up by the manufacturer into a unit of the shape and size of a cigarette, and loose tobacco which must be coaxed into that form by the smoker," Mr Jacobs said.
The court still has to make its final ruling on the case. Judgements often follow similar lines to the opinion from the Advocate General. (pi)