Finance ministers from across the European Union meet in Brussels on Monday, with defence financing and a long-delayed overhaul of tobacco taxation at the top of the agenda.

The Eurogroup, chaired by Greece’s Kyriakos Pierrakakis, opens at 09:00, first in regular format on the euro area’s macroeconomic and fiscal outlook, inflation and banking union, then in inclusive format, with all EU states, on defence financing, including joint procurement and better use of public money. NATO Secretary General Mark Rutte will join that session.

Tobacco tax deal faces Swedish hurdle

In the afternoon, the Economic and Financial Affairs Council (ECOFIN), chaired by Ireland’s Simon Harris, will try to reach political agreement on a package revising EU tobacco taxation. The proposals would raise minimum excise duties on conventional tobacco and extend harmonised rules to vaping liquids, heated tobacco and nicotine pouches.

Agreement is not guaranteed. Tax legislation needs the unanimous backing of all 27 member states, and Sweden, which has no government in place, has been reported to object to the proposed duty on nicotine pouches, a product widely used in Sweden. Bilateral talks were continuing ahead of the meeting.

Italy’s defence spending and Ukraine aid

ECOFIN is expected to approve Italy’s use of the national escape clause under EU fiscal rules, giving Rome flexibility worth up to 1.5% of GDP over four years for defence spending and energy security measures. Ministers will also discuss the economic impact of Russia’s war against Ukraine and Kyiv’s budget needs for 2027. Press conferences follow the Eurogroup at about 13:30 and ECOFIN at about 18:45.