THE EU: Ireland has been given two months to change the way it collects tobacco taxes - or face European Court action.
The ultimatum came from the European Commission in a warning that the State is out of step with EU single-market requirements about how - and in particular when - excise duties are collected.
Under EU rules, payment of duty can only be demanded from traders in manufactured tobacco once the product reaches the retail market.
Traders producing goods liable for excise duties can manufacture, store and transport those products across the EU, but pay the duties only when they go on sale.
The Government operates a tax system under which manufactured tobacco must carry "fiscal marks" on the packaging - marks which are made available only on payment of the excise duty.
A Commission statement explained: "The Commission considers that, by treating the time at which traders are asked to obtain fiscal marks as equivalent to the time of release for consumption, Irish law is incompatible with (EU law)."
Ireland, the UK and seven other EU countries were threatened with legal action this afternoon for failing to keep Brussels informed about national limits on the use of an ozone-damaging pesticide.
The pesticide, methyl bromide, is being phased out under EU law. Governments must report annually to the European Commission, stating the amount they have used, and how its use is being reduced.