Govt approves increase in excise taxes on alcohol, tobacco products from July 1, 2024 to minimum level established in EU
The Cabinet of Ministers has approved a bill amending the Tax Code of Ukraine to bring the country's legislation closer to that of the European Union regarding excise tax rates.
As reported by a representative of the Cabinet of Ministers in the Verkhovna Rada, Taras Melnychuk, on Telegram, the decision was made at the government meeting on Friday.
According to the announcement, the bill aims to implement Article 353 of the Association Agreement between Ukraine and the EU and Appendix XXVIII to Chapter 4 "Taxation" of Section V "Economic and Sectoral Cooperation" of the Association Agreement and brings excise tax rates closer to the minimum level set in the EU.
The bill proposes to designate the term "intermediate products" for wine and other fermented beverages (including mixtures of fermented beverages and mixtures based on fermented beverages) with an actual strength exceeding 1.2% by volume of ethyl alcohol but not exceeding 22% by volume of ethyl alcohol.
Moreover, an increase in the excise tax rate by UAH 3.81 – from UAH 8.42 to UAH 12.23 per liter for intermediate products is provided (up to the level of the current rate for sparkling wines and sparkling wines, fermented beverages, sparkling flavored wines (sparkling wines).
The bill defines the schedule for annual increases in such rates from July 1, 2024, to December 31, 2027, inclusive, taking into account the overall difference between the rates expected as of January 1, 2028, as provided for by current legislation.
The term "weighted average retail selling price of cigarettes" is clarified.