Russia's Tax Increase on Nicotine E-Cigarette Liquid Expected to Bring 10 Billion Rubles in Revenue

Nov.24.2023
Russia's Tax Increase on Nicotine E-Cigarette Liquid Expected to Bring 10 Billion Rubles in Revenue
Russia's Finance Ministry estimates that doubling the tax on nicotine e-cigarette liquid will bring in 10 billion rubles.

According to recent reports from TASS, the Russian Ministry of Finance has estimated that doubling the tax on nicotine e-cigarette liquid will result in a benefit of 10 billion rubles (approximately 800 million yuan).


Alexei Sazanov, Deputy Minister of Finance, stated during a full session of the federal commission, "We anticipate the benefits to be around 10 billion rubles. Currently, this tax rate essentially serves as a prohibition, and we believe it will help increase budget revenues while reducing the consumption of nicotine products." This was his response regarding the expected financial benefits of raising the tax rate on nicotine e-cigarette liquid.


Previously, the Federal Commission approved a tax increase on tobacco products starting in 2024.


According to recently passed legislation, the tax rates for cigarettes and cigars will increase in 2024 to 2,813 rubles per thousand units plus 16% of the calculated price, but not less than 3,820 rubles. In 2025, the tax rate for cigarettes will further rise to 2,926 rubles per thousand units, plus 16% of the calculated price (not less than 3,973 rubles). By 2026, the tax rate for cigarettes will be further increased to 3,043 rubles per thousand units, plus 16% of the calculated price (not less than 4,132 rubles).


Currently, the tax rate for cigarettes is set at 2603 rubles per thousand units, plus an additional 16% of the calculated price, with a minimum price of 3536 rubles.


Regarding the tax rates for nicotine e-cigarette liquid, it is projected that in 2024, the rate will be 42 rubles per milliliter. In 2025, it will increase to 44 rubles per milliliter, and in 2026, it will further rise to 46 rubles per milliliter.


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