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Tag: excise tax

  • Sri Lanka Cigarette Production Falls 32% as Tobacco Taxes Rise

    Sri Lanka Cigarette Production Falls 32% as Tobacco Taxes Rise

    Cigarette production in Sri Lanka fell 32% from 2.8 billion sticks in 2022 to 1.9 billion in 2025 following successive increases in tobacco taxes, Deputy Minister of Economic Development Nishantha Jayaweera told Parliament today (Aug. 20), according to The Morning.

    Excise duties on cigarettes have increased four times since 2023, including increases of 20% in January and July 2023, 14% in January 2024 and 5.9% in January 2025. The government also raised VAT from 15% to 18% in January 2024 and corporate income tax from 40% to 45% in April 2025. Current cigarette excise duties range from 26.59 to 109.95 Sri Lankan rupees ($0.08 to $0.33) per cigarette, based on cigarette length.

    Jayaweera said the tax policy is intended to increase government revenue while reducing healthcare costs and other socioeconomic impacts associated with tobacco use. He said higher tobacco taxes have contributed to gradual increases in direct and indirect tax revenue while supporting public-health objectives.

  • UAE Vape Tax to Raise Prices in September

    UAE Vape Tax to Raise Prices in September

    The UAE will introduce a minimum excise price of Dh1 ($0.27) per milliliter for e-cigarette and vape liquids on Sept. 1, with the existing 100% excise rate applied to the higher taxable value. A 60ml bottle retailing for Dh40 ($10.80), for example, will be taxed as if it were priced at Dh60 ($16.20).

    Doctors and vapers told The National the higher prices could discourage vaping among young people and prompt some existing users to cut consumption or quit. Retailers, however, warned that a wider price gap between legal and unofficial products could encourage consumers to turn to unregulated sellers.

    The UAE already applies a 100% excise tax to vaping and e-cigarette liquids. The new minimum-price mechanism comes as other countries introduce or tighten vape taxes, including the U.K., which will implement a dedicated levy in October.

  • Bulgaria Raises Tobacco Excise Taxes

    Bulgaria Raises Tobacco Excise Taxes

    Bulgaria increased excise duties on cigarettes and other tobacco products as its 2026 State Budget took effect Aug. 1. The cigarette excise rate rose from €113.51 to €120 per 1,000 cigarettes, increasing the pre-VAT price of a pack by about €0.13. The government has also scheduled further increases to €126 per 1,000 cigarettes on March 1, 2027, and €132 per 1,000 cigarettes on Jan. 1, 2028. Excise duties on smoking tobacco increased from €121.69 to €130 per kg, while the rate on heated tobacco products rose from €214 to €225 per kg.

    According to Bulgaria’s Ministry of Finance, the accelerated excise increases are intended to boost government revenue and align with ongoing European Union discussions on higher minimum tobacco tax rates. The ministry estimates the higher excise duties and related VAT collections will generate an additional €155.9 million in revenue during 2026.

  • Maldives Debates Proposal to Halve Cigarette Import Duty

    Maldives Debates Proposal to Halve Cigarette Import Duty

    A proposal to cut the Maldives’ cigarette import duty from MVR 8 to MVR 4 ($0.52 to $0.26) per cigarette sparked heated debate in Parliament, highlighting divisions over the impact of tobacco taxation on public health and illicit trade. The government-backed bill would reverse a 2024 duty increase introduced after concerns that a vape ban could drive smokers toward cigarettes.

    Ruling PNC lawmakers defended the original tax hike as a public health measure, while opposition MDP members argued that higher duties have fueled cigarette smuggling and reduced customs revenues. Opposition lawmakers claimed the tax increase helped create a growing black market, with alleged state revenue losses reaching MVR 2 billion ($130 million). Supporters of the duty reduction also argued that previous tax increases failed to curb tobacco use and instead shifted demand toward illicit products.

  • UK Vaping Duty Expected to Generate £565M by 2030

    UK Vaping Duty Expected to Generate £565M by 2030

    The UK will introduce its new Vaping Products Duty (VPD) on October 1, applying to all vaping liquids, including nicotine-free products. The measure is expected to significantly boost government revenue, with vaping duty receipts projected to rise from £135 million in fiscal 2026/27 to £565 million by 2030/31.

    Under the new rules, travelers aged 17 and older entering Great Britain will be allowed to bring in up to 50ml of vaping liquid duty-free for personal use. Anyone carrying more than 50ml must declare the products and pay duty on the entire quantity, not just the excess amount.

    Northern Ireland will operate under different arrangements due to its access to the EU goods market. Travelers arriving directly from EU countries may continue bringing unlimited quantities of vaping liquid for personal use without paying duty, while arrivals from non-EU countries remain subject to existing personal goods allowances.

    The new duty and traveler limits are expected to affect duty-free retailers serving UK-bound passengers, potentially reducing purchase volumes and prompting adjustments to product assortments. HMRC has urged retailers and stakeholders to provide clear passenger guidance to minimize border non-compliance.

  • Vietnam Eyes Illicit Market as it Introduces Mixed Tobacco Tax  

    Vietnam Eyes Illicit Market as it Introduces Mixed Tobacco Tax  

    Vietnam’s planned introduction of a mixed tobacco excise tax from 2027 is expected to combine a 75% ad valorem rate with a gradually increasing specific tax, adding 2,000 VND ($0.08) per pack annually and reaching 10,000 VND ($0.38) by 2031. The policy aims to reduce smoking rates, increase the tax share of retail prices to nearly 60%, and boost excise revenue, which is projected to more than double to 39.1 trillion VND ($1.5 billion) by 2030. However, officials and experts warn that higher taxes could widen price gaps and push some consumers toward illicit tobacco, which already accounts for an estimated 20–22% of the market and causes annual tax losses of up to 6 trillion VND ($228 million).

    Authorities say stronger enforcement will be critical to support the policy, including higher penalties for smuggling and retail violations, expanded oversight of e-commerce sales, and coordinated action among customs, police, and border forces. Recent enforcement efforts have resulted in over 23 million packs of illicit cigarettes seized and more than 1,600 violations recorded, though officials note that trafficking remains widespread and increasingly sophisticated across multiple regions.

  • Report: New 15% Tobacco Tax One of Five Streams EU Considering  

    Report: New 15% Tobacco Tax One of Five Streams EU Considering  

    Reuters reported that the European Union is discussing five new revenue streams that would help fund its seven-year budget, allowing for new priorities like defense ​and competitiveness and service joint debt, while limiting cuts to agriculture and regional aid.

    The proposed streams for 2028-2034 are an emissions trading system, a carbon border adjustment mechanism levy, a non-collected electronic ⁠waste tax, a corporate ​resource for ⁠Europe levy, and a tobacco excise duty. The tobacco tax would be a new 15% uniform call-rate tobacco duty, paid by EU member states from national budgets, which would bring in an estimated €11.2 billion ​a year, the ​Commission says.

    By a vote of 370-201, EU’s parliament voted to increase its budget 1.26%, increasing total spending to about €1.94 trillion.

  • Indonesia’s Tax Strategy Not Impacting Smoking Rates

    Indonesia’s Tax Strategy Not Impacting Smoking Rates

    Indonesia’s long-running reliance on tobacco excise increases has failed to significantly curb smoking, according to a National Health Survey, with around 70 million people still using tobacco and prevalence remaining among the highest globally. Despite a 23% tax increase in 2020 and steady annual rises since, cigarette affordability has remained largely unchanged, as income growth has offset price increases, leaving consumers spending roughly the same share of income on cigarettes over the past decade.

    Analysts say structural issues are undermining the effectiveness of tax policy, particularly wide price disparities across product categories. Lower-taxed hand-rolled kretek cigarettes continue to provide a cheaper alternative, encouraging smokers to downtrade rather than quit. This dynamic has limited the impact of higher taxes on overall consumption.

    Health economists argue that without more aggressive and harmonized tax reforms, excise policy alone will continue to fall short as a deterrent. The findings underscore broader challenges for tobacco control strategies in emerging markets, where affordability and product substitution can blunt the intended impact of fiscal measures.

  • Poland Moves to Tax Induction E-Cigarettes

    Poland Moves to Tax Induction E-Cigarettes

    Poland’s government is set to introduce excise duties on induction-based e-cigarettes, aiming to close regulatory gaps that have allowed some products to be taxed at lower rates, according to a report from WNP. Under proposed amendments to the Excise Tax Act, devices and liquid tanks using electromagnetic induction — identified by the presence of a ferromagnetic element — will be classified as e-cigarettes and subject to a PLN 40 ($11.20) per unit tax. The move is part of broader efforts to tighten oversight of emerging vape technologies and ensure consistent taxation across the category.

  • Tasmanian Retailers Demand Tobacco Tax Overhaul

    Tasmanian Retailers Demand Tobacco Tax Overhaul

    Tasmania’s independent retailers are calling on the Australian government to overhaul its tobacco excise strategy, warning that the black market has spiraled “beyond control.” Tasmania Independent Retailers (TIR), representing 80 IGA and IGA-branded stores, said illicit cigarettes are being sold for as little as A$10 per pack ($7), compared with A$40–50 ($28–35) for legal products, fueling organized crime and undercutting legitimate retailers.

    TIR chair Michael Baxter criticized the government for persisting with high excise rates and heavy enforcement spending while failing to curb illegal sales, citing unregulated menthol products and weak age checks as risks to youth. Federal excise revenue has dropped from over A$16 billion ($11.2 billion) in 2019 to about A$7.4 billion ($5.2 billion) currently, and 2025 research by FTI Consulting estimates that illicit tobacco now accounts for roughly half of all cigarettes consumed in Australia. Baxter called for recalibrated excise settings and more targeted enforcement, labeling current policy “a disaster” that has left the government effectively losing control of the market.