Cigarette prices will increase in Ukraine from April 1 due to a new excise rate

From April 1 to December 31, 2025, cigarette manufacturers and importers in Ukraine will be required to apply a coefficient of 1.1 to the minimum excise tax liability. This means that the excise tax on tobacco products will increase by 10%, which is likely to lead to an increase in retail prices for cigarettes.

Reasons for introducing a new coefficient

According to the results of declarations by excise tax payers for 2024, the share of the total amount of excise tax liabilities in the weighted average retail price of cigarettes was 55.8%, which is less than the established threshold of 60%. According to the Tax Code of Ukraine, if this indicator is lower than 60%, an increasing coefficient is applied to the minimum excise tax liability. Thus, from April 1, 2025, this coefficient will be 1.1, the State Tax Service said.

Who will be affected by the innovation?

The application of the coefficient 1.1 applies to all manufacturers and importers of tobacco products, in particular: – cigarettes without a filter (UKT FEA code 2402 20 90 10); – cigarettes with a filter (UKT FEA code 2402 20 90 20).

This means that all tobacco products that fall under these categories will be subject to increased excise tax.

How will this affect consumers?

For consumers, this innovation means a possible increase in cigarette prices. An increase in excise tax by 10% may lead to a corresponding increase in retail prices. Therefore, smokers should be prepared for additional costs for the purchase of tobacco products.

This innovation is part of the state policy to increase budget revenues and control tobacco consumption. Consumers are advised to take into account possible price increases when planning their spending.

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