The State Duma Committee on Budget and Taxes approved an increase in the excise tax rates on tobacco products for the period from March 1, 2023 to the end of 2025: cigarettes, papirosas, as well as liquid for heating tobacco and tobacco intended for consumption by heating. The relevant amendments initiated by the Government of the Russian Federation are contained in the bill recommended by the committee for adoption in the second reading on the introduction of an excise tax on disposable vapes and liquids for them.
It is planned that the State Duma will consider the document at the plenary session on January 18.
According to the amendments, the excise tax rate on cigarettes and papirosas will be from March 1 to December 31, 2023, inclusive, 2,603 rubles per 1 thousand pieces plus 16% of the estimated cost calculated based on the maximum retail price, but not less than 3,536 rubles per 1 thousand pieces; from January 1 to December 31, 2024, inclusive - 2,707 rubles for 1 thousand pieces plus 16% of the estimated cost calculated based on the maximum retail price, but not less than 3,678 rubles for 1 thousand pieces; from January 1 to December 31, 2025 inclusive - 2,815 rubles for 1 thousand. pieces plus 16% of the estimated cost, calculated based on the maximum retail price, but not less than 3,825 rubles per 1 thousand pieces.
From January 1, 2023, the excise tax on cigarettes and papirosas amounted to 2,552 rubles per 1 thousand pieces plus 16% of the estimated cost calculated based on the maximum retail price, but not less than 3,467 rubles per 1 thousand pieces.
The excise tax rate on tobacco (tobacco products) intended for consumption by heating will be from March 1 to December 31, 2023 inclusive 8,669 rubles per 1 kg; from January 1 to December 31, 2024 inclusive - 9,016 rubles per 1 kg; from January 1 to December 31, 2025 inclusive - 9 377 rubles for 1 kg.
The excise tax on liquid for electronic nicotine delivery systems will be 20 rubles per 1 ml from March 1 to December 31, 2023 inclusive, 21 rubles per 1 ml from January 1 to December 31, 2024 inclusive, and 22 rubles per 1 ml from January 1 to December 31, 2025 inclusive.
About the bill
Initiated by the head of the Federation Council Committee on Economic Policy Andrey Kutepov and his deputy Alexey Sinitsyn, the bill on the introduction of the excise tax rate on electronic means of nicotine delivery (vapes) and liquid for electronic nicotine delivery systems was adopted by the State Duma in the first reading on September 13.
In the second reading, the Government's amendments finalized the definition of electronic nicotine delivery systems: they "recognize electronic devices used to convert liquid for electronic nicotine delivery systems into an aerosol (vapor) inhaled by the consumer." Liquid for electronic nicotine delivery systems is recognized as "any liquid containing liquid nicotine in a volume of 0.1 mg/ml for electronic nicotine delivery systems, including those contained in such devices."
As the Deputy Head of the Ministry of Finance of the Russian Federation Alexey Sazanov said at the meeting of the committee, as part of the amendments to the second reading, it is proposed to change the concept of excise tax collection. "We are moving from two objects of taxation to one, that is, if we now have electronic nicotine delivery systems and liquid in them, then there will be one object of excise taxation - this is liquid for electronic nicotine delivery systems," he said.
According to the deputy minister, the rates will be indexed in such a way as to prevent falling budget revenues.
The rates of excise duty on cigarettes are proposed to be indexed by 2% additionally, for heated tobacco - by 11%, Sazanov noted.
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