The draft of Budget Law 2023 foresees an increase in excise duties on cigarettes and tobacco starting next year, with the obvious consequence of an increase in prices for smokers and consumers in general.
Specifically, it will growfixed amount per unit of product.
It will arrive at 36 euros for 1,000 cigarettes starting from next January 1st.
From 2024 it will be 36.5 euros and from 2025 it will go to 37 euros.
The increase in excise duties will also affect the consumewith a price increase which might be around 70 cents on the standard pack of 20.
For official confirmation of the measures, we must wait for the conclusion of the parliamentary process of the Maneuver.
Cigarette and tobacco taxation, increase in excise duties and prices from 2023?
News in the draft of the 2023 Budget Law: among the measures also the increase of taxation of cigarettes and tobacco.
Starting from 1 January next year, an increase in excise duties is expected, which will affect the consume.
This is provided for by article 28 of the draft text, entitled as Provisions on excise duty on manufactured tobacco and consumption tax on substitute products for smoking products.
Overall action is therefore taken not only on cigarettes but also on cigars, snuff, chewing, pipe and inhalation tobacco.
The text intervenes directly on the legislative decree 26 October 1995, n. 504, redefining the two items that make up the excise.
In particular, it will increase the“fixed specific amount per unit of product”As shown below:
|Price||Number of cigarettes||Year|
|36.00 euros||1,000 cigarettes||2023|
|36.50 euros||1,000 cigarettes||2024|
|37.00 euros||1,000 cigarettes||2025|
L’increase on single pack of 20 for the consumer it should settle on the amount of about 70 cents..
Furthermore, the percentages indicating theminimum tax burden for cigarettes:CopyAMP code
- for the 2023 it will be 96.22 percent;
- for the 2024 by 86.50 per cent;
- from 2025 by 96.90 percent.
This percentage must include the fixed component of the rate, the second part of the basic rate and the VAT on the product, currently at 22 percent.
The last part to consider in the overall price is thebonus which belongs to the tobacconist: equal to 10 percent of the selling price.
Cigarette and tobacco taxation, consumption tax rates are also changing
The draft text of the 2023 Budget Law also envisages interventions on tax ratesconsumption tax provided for smokeless inhalation tobaccos.
In this case the rate drops from 40 per cent to 36 per cent for next year.
There summary table indicates the new rates foreseen for the next few years.
The draft text also defines the times for issuing the new MEF decrees for the recalculation of the rates.
In article 39-octies of the legislative decree 26 October 1995, n. 504, the paragraph 10-bis:
“By decree of the Minister of Economy and Finance, of a non-regulatory nature and to be issued by the end of May of each year starting from the year 2023, the percentage incidence of the amount referred to in paragraph 3 is determined , letter a), on the amount of the total tax burden calculated with reference to the “PMP-cigarettes” recorded in relation to the previous year; if the aforementioned percentage incidence is not included in the range referred to in Article 8, paragraph 4 of Council Directive 2011/64/EU of 21 June 2011, with the same decree it is consequently redetermined, by 1 January of the second year subsequent, the aforesaid specific component so as to ensure that the same recalculation does not result in lower tax revenues, compared to the previous calendar year, in relation to the application of excise duty on cigarettes.”
Within end of Maystarting from 2023, the Ministry of Economy and Finance will have to issue a decree to determine the incidence of the percentage offixed amount per unit of product.
If this percentage does not fall within the parameters indicated by the specific European directive, by 1 January of the second following year the specific component will be redetermined for avoid lower revenues for the state.