New, increased excise tax rates are in effect

Starting from September 1, 2024, in connection with the entry into force of the Law of Ukraine No. 3878-IX dated 18.07.2024 "On Amendments to the Tax Code of Ukraine on the Implementation of the Provisions of the European Union Law on Excise Tax" (hereinafter - Law No. 3878), which was published in the newspaper "Holos Ukrainy" on September 1, 2024, new excise tax rates on gasoline, gas oil (diesel fuel), liquefied gas, and alternative motor fuel will apply .

Thus, from September 1, 2024 to December 31, 2024 inclusive, the following excise tax rates are set:

♦ for gasoline - EUR 242.6 per 1000 liters;

EUR 177.6 per 1000 liters for gas oil (diesel fuel)

Liquefied gas - 148 euros per 1000 liters;

♦ for alternative motor fuel - EUR 184.08 per 1000 liters.

The amendments introduced by Law No. 3878 to the Tax Code also provide for

- definition of the term "intermediate products" in accordance with Directive 92/83/EC of 19 October 1992 on the harmonization of excise duty structures on alcohol and alcoholic beverages (paragraph 14.1 of the TCU was supplemented by a new subparagraph 14.1.²⁶¹)

- increase of the excise tax rate for intermediate products from UAH 8.42 to UAH 12.23 per 1 liter (by UAH 3.81), i.e. at the level of the current rate for sparkling wines and carbonated wines, fermented beverages, flavored sparkling wines (beverages) (amendments to subparagraph 215.3.1 of the TCU).

In accordance with paragraph 1 of Section II "Final Provisions" of Law No. 3878, the amendments regarding the increase in the excise tax rate for intermediate products shall enter into force and become effective on December 1, 2024;

- establishing new excise tax rates on fuels in view of their minimum level as provided for by Council Directive 2003/96/EC of 27 October 2003 on the restructuring of the Community system for the taxation of energy products and electricity.

In particular, starting from January 1, 2028, the following excise tax rates will be set for the main types of fuel:

♦ on gasoline - EUR 359 per 1000 liters

EUR 330 per 1000 liters for gas oil (diesel fuel)

EUR 250 per 1000 liters for liquefied gas;

♦ for alternative motor fuel - EUR 272.4 per 1000 liters.

At the same time, the new paragraph 48 of subsection 5 of section XX "Transitional Provisions" of the Tax Code establishes a schedule of annual increases in the excise tax rates on fuel from 09/01/2024 to 12/31/2027 inclusive (for four years);

- clarification of the term "total amount of tax liabilities on excise tax on cigarettes" and calculation of the share of the total amount of tax liabilities on excise tax in the weighted average retail price of cigarettes (including excise tax on retail trade in excisable goods);

- clarification of the term "weighted average retail price of cigarettes", namely: the weighted average retail price of cigarettes is the price calculated from the sum of the total cost of all cigarettes (including all taxes, including the amount of excise tax on retail trade in excisable goods) sold by manufacturers in the customs territory of Ukraine and imported by importers into the customs territory of Ukraine for the period from January 1 to December 31 of the reporting year inclusive, divided by the sum of the total number of cigarettes sold by manufacturers and imported by importers.

In accordance with paragraph 1 of Section II "Final Provisions" of Law No. 3878 , the amendments to clarify these terms come into force and take effect on January 1, 2025.