Germany doesn't allow nicotine pouches to be sold. It also can't stop 1.5 million people from using them.

In June 2026, the Scientific Service of the German Bundestag published an analysis (document WD 4 – 3000 – 036/26) that puts a number on that contradiction: a legal, taxed pouch market could have raised an estimated €311 to €368 million in 2026 alone — revenue the state is instead forfeiting to a grey market it cannot control. The document was first reported by drucksachlich.de on 1 July 2026.

The finding reframes the German pouch debate. It is no longer just a public-health question about whether pouches should be sold. It is now also a fiscal question about whether a ban that 1.5 million people ignore is worth hundreds of millions of euros a year in lost tax — and whether a regulated market would do a better job of protecting the teenagers the current ban is meant to shield.

What the ban actually is

Germany has no single statute that says "nicotine pouches are illegal." The prohibition is a de-facto one, built from food law. Authorities classify tobacco-free nicotine pouches as novel foods (neuartige Lebensmittel) that are not marketable because of their harmful health effects — so placing them on the market is not permitted.

The Federal Institute for Risk Assessment (BfR) reached that view in 2022, when it found that roughly 2% of the German population regularly consumes nicotine pouches. Because the products fall outside the tobacco-product and e-cigarette frameworks, there is no legal route to sell them domestically. Enforcement is left to the states, with Bavaria the most visible actor cracking down on physical retail.

The result is a market that runs on import: pouches arrive mostly through online platforms based in other EU countries and through a growing physical black market. Serious total-market data does not exist; the user figures rest on surveys and estimates.

How big the grey market is

The Bundestag analysis draws on several data points to size the market the ban is failing to stop:

• A trade analysis by Ipsos, commissioned by Philip Morris International, found nicotine pouches on sale in roughly 16% of the examined retail outlets — and about a third of those products were counterfeits.
• Online retailer Haypp reported 37% sales growth in Germany for 2024.
• The Consumer Choice Center, building on the 2% BfR prevalence figure, estimates 1.5 million regular users in 2026 consuming around eight pouches a day.

Put together, the picture is of a sizeable, growing consumer market operating almost entirely outside German legal retail — with no age checks, no product standards, and no tax paid.

What the ban costs

This is the part the Bundestag document quantifies. Two estimates sit side by side, and they disagree by a factor of roughly three:

• The Deutsche Zoll- und Finanzgewerkschaft (the customs and finance union) and the Bundesverband der Tabakwirtschaft (tobacco trade association) put the annual lost tobacco and VAT revenue at around €100 million.
• The Consumer Choice Center, using 1.5 million users, eight pouches a day, a €6 can price, 19% VAT, and tax-rate scenarios modelled on Sweden, Italy and Austria, estimates a €311 to €368 million loss for 2026 — rising to €466–552 million in 2027 and a cumulative €1.85 to €2.2 billion across 2027–2029 if the market stays largely illegal.

The Bundestag analysis is explicit that all of these are estimates "with considerable uncertainty," because there is no reliable data on a market that is, by definition, not supposed to exist. The range itself — €100 million versus €368 million — is the clearest signal of how little anyone actually knows about the size of the trade the ban has created.

Why Germany is split

The numbers have not produced a consensus. They have produced two opposing camps.

On one side, industry and the customs union argue for legalization. British American Tobacco and the Bundesverband der Tabakwirtschaft und neuartiger Erzeugnisse (BVTE) have registered lobbying activity with the Bundestag seeking a framework that would allow nicotine pouches ("Nikotinbeutel zulassen") and regulate them by harm potential rather than prohibition. PMI commissioned the Ipsos market study that documented how widely the banned products are already sold. Their argument: a regulated, taxed market brings control, age verification, product standards and revenue that a grey market provides to nobody.

On the other side, public-health groups want no legalization. In August 2026 the NGO Bündnis Kinder- und Jugendgesundheit registered a lobbying position against the authorization of nicotine pouches in Germany, citing youth protection. Their position is that bringing a harmful, addictive product into the legal market does not protect young people — it normalizes it.

The German upper house has already staked out a position on the related EU question. The Bundesrat rejected including nicotine pouches in the EU's planned excise directive, arguing that taxing the products must not be allowed to pre-legitimize their placement on the market. In other words: tax first implies legal first, and Germany's states are not ready to imply that.

The EU tax plan hanging over the debate

The Bundestag analysis sits against a broader EU move. In July 2025 the European Commission adopted a proposal (COM(2025) 580) to recast the Tobacco Taxation Directive, which would classify nicotine pouches as "tobacco-related products" for the first time and set a minimum excise of €71.50 per kilogram or 25% of the retail price from 2030, rising to €143 per kilogram or 50% from 2032.

The European Parliament and the European Economic and Social Committee have pushed for lower rates. Germany's Bundesrat objection is a domestic signal that not every member state wants the EU directive to do the work its own ban has failed to do.

A neighbour has already moved. Austria began taxing nicotine pouches on 1 April 2026 at €35 per kilogram, stepping up to €45 from February 2028 — an early test of whether a legal, taxed pouch market can replace a grey one. Austria's total extra tobacco-tax revenue for 2026–2029 is forecast at €465 million, though the pouch share is not broken out separately.

What's next

Germany now faces the choice the Bundestag document lays bare. Keep the ban, and accept a grey market of 1.5 million users, no age checks, counterfeit products, and hundreds of millions in forfeited tax. Legalize and tax, and gain revenue and controls — but also grant a legal status to a product health groups say should stay banned. The middle path the Bundesrat is signalling — taxing without legalizing — is legally awkward and practically impossible, since you cannot collect excise from a market you refuse to recognize.

The EU's 2030 excise deadline and Austria's live experiment will both pressure Berlin to decide. For now, the Bundestag's own researchers have made the hardest argument to ignore: the ban is not stopping use, and it is costing real money.

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Compare nicotine pouch brands and prices across retailers at PouchFinder.

SOURCES:

• Bundestag Scientific Service analysis (WD 4 – 3000 – 036/26), summarized by drucksachlich.de, "Steuerausfälle durch illegale Nikotinbeutel in Deutschland." 1 Jul 2026. drucksachlich.de
• Consumer Choice Center, "Milliarden futsch! Nikotin Pouches: Legalisieren, regulieren, besteuern – statt Graumarkt." 28 Jan 2026. Consumer Choice Center
• European Commission, "European Commission modernises Tobacco Taxation Directive." 16 Jul 2025. Proposal COM(2025) 580. EC Taxation and Customs Union
• Tobacco Journal International, "GERMANY PMI and trade bodies call for nicotine pouch regulation." 3 Mar 2026. Tobacco Journal
• Lobbyregister Deutscher Bundestag, BAT / BVTE Regelungsvorhaben "Nikotinbeutel zulassen." Bundestag Lobbyregister