The Government has drafted a bill to increase the excise tax
On May 10, the Government approved the Draft Law "On Amendments to the Tax Code of Ukraine on the Approximation of Ukrainian Legislation to the Legislation of the European Union in the Field of Excise Tax" at a regular meeting.
The draft law is aimed at implementing Article 353 of the Association Agreement and Annex XXVIII to Chapter 4 "Taxation" of Title V "Economic and Sectoral Cooperation" of the Association Agreement and aims to bring excise tax rates closer to the minimum level established in the EU.
The Draft Law proposes to define the term "intermediate products" as wines and other fermented beverages (including mixtures of fermented beverages and mixtures based on fermented beverages), the actual strength of which is higher than 1.2% by volume of ethyl alcohol, but not higher than 22% by volume of ethyl alcohol.
It also provides for
- Increase of the excise tax rate from UAH 8.42 to UAH 12.23 per 1 liter (by UAH 3.81) for intermediate products (to the level of the current rate for sparkling wines and carbonated wines, fermented beverages, flavored sparkling wines (beverages)
- establishing new excise tax rates on fuel, taking into account their minimum level, in accordance with Directive 2003/96/EC, which will come into force on January 1, 2028.
- In particular, it is proposed to set the following excise tax rates
- for gasoline - EUR 359 per 1000 liters
- for gas oil (diesel fuel) - EUR 330 per 1000 liters
- for liquefied gas - EUR 277 per 1000 liters.
At the same time, the law provides for a schedule of annual increases in such rates from 01.07.2024 to 31.12.2027 (inclusive), taking into account the overall difference between the rates as of 01.01.2028 and the excise tax rates provided for by the current legislation. The Law also clarifies the term "weighted average retail price of cigarettes".
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