Novations regarding the excise tax on tobacco products, liquids used in electronic cigarettes are introduced from March 25

Press service of the State Tax Service of Ukraine, published 25 March 2025 at 19:03 Chapter: News

Law of Ukraine № 4115-IХ as of 04.12.2024 “On amendments to the Tax Code of Ukraine and other Laws of Ukraine regarding revision of the excise tax rates on tobacco products” (hereinafter – Law № 4115) entered into force on March 25, 2025. It was published in the newspaper “Holos Ukrayiny” on March 25, 2025 under № 58.

The Law made changes to the:

- Tax Code of Ukraine;

- Law of Ukraine № 3817-IX as of 18.06.2024 “On state regulation of production and circulation of ethyl alcohol, alcohol distillates, bioethanol, alcoholic beverages, tobacco products, tobacco raw materials, liquids used in electronic cigarettes and fuel” (hereinafter – Law № 3817).

Main changes to the Tax Code of Ukraine

1. Regulation of the retail price of excisable products:

for setting the maximum retail price for tobacco products;

for the retail sale – the retail price cannot be less than the minimum excise tax liability or the excise tax rate multiplied by 1.45.

2. Introduction of a new term “non-alcoholic beer”:

defined as a foamy beverage with alcohol content of 0.5% vol. or less;

refers to commodity heading 2202 according to Ukrainian classification of the foreign economic activity products.

3. Application peculiarities of the exchange rates:

- for tobacco products, official exchange rate of the National Bank of Ukraine at 00 hours 00 minutes on the first day of a calendar half-year preceding the half-year in which:

purchase of the excise tax marks (until January 1, 2026) is carried out;

formation of a unique identifier (from January 1, 2026);

sale of tobacco products produced in the customs territory of Ukraine or submission of a customs declaration;

accrual of the excise tax obligations on tobacco raw materials and tobacco wastes.

4. Reduction of the total losses and wastes:

reduction from 10% to 5% for production of fermented tobacco raw materials.

5. Excise tax rates on tobacco products, tobacco and produced tobacco substitutes:

is set in units of Euro.

6. Annual increase in the excise tax rates:

starting from the date of entry into force of the Law № 4115 until 31.12.2027, the excise tax rates will be gradually increased.

7. Recalculation of the excise tax rates:

determining amounts of tax paid to the budget by producers and importers.

8. Easing of the anti-forstolling restrictions:

Temporarily, for a period of the martial law, average monthly sales volume of the excise tax marks has been increased to 120% (previously it was 115%) before increase in the excise tax rates.

Main changes to the Law № 3817

1. Expansion of the equipment list:

machines for production of cigarette filters, cigarette cases were added.

2. Introduction of the new fines:

alcohol wholesale at prices lower than the established minimum;

lack of video surveillance at tobacco production enterprises;

retail sale of excisable products at prices lower than the established ones.