The government plans to raise the excise tax on alcohol and cigarettes. The bill on this issue has already been submitted to the Chamber of Deputies and sent for first reading – we can read it on the website of the Chamber of Deputies of our Parliament. The excise tax on alcohol is expected to increase by 10 percent in 2022 and by 5 percent each year over the coming years until 2027. According to the governors, the changes are aimed at reducing the consumption of stimulants by consumers.
It is a bill amending the excise tax law. The new regulations will come into effect from the beginning of 2022.
The next House session is scheduled for October 28-29.
Excise tax on alcohol and cigarettes – changes
According to the project, excise tax rates on ethyl alcohol, beer, wine and fermented beverages excluding cider, beer (pear alcohol) and intermediate products will be 10 percent higher in 2022. The proposed regulation also provides for an increase in the minimum excise tax rate on cigarettes from the current 100 percent to 105 percent of the total amount of the excise tax and the excise tax rate on innovative products by increasing the specified rate by 100 percent. It added that a minimum excise tax rate for tobacco smoking will also be introduced at 100 percent of the total excise tax.
In turn, for the years 2023-2027, it has been proposed to introduce a schedule of increases in the excise tax on: ethyl alcohol, beer, wine, fermented beverages and intermediate products each year at a rate of 5 percent; Cigarettes and Tobacco To smoke cigars, cigars, innovative products and raw tobacco, increasing the share each year by 10 percent.
Alcohol and cigarette prices
The authors of the draft noted in the justification that “an increase in excise tax rates will mean an increase in the prices of alcoholic beverages.”
Government calculations show that if the financial burden is passed on to consumers, the potential price increase will be: in the case of a bottle of vodka, 40 percent. – about 1.50 PLN; dry wine bottles (0.75 l) – about 16 grs; a half-liter can of beer – about 6 grs; Cigarette packs – about 30 grs.
“The increase in excise rates on alcoholic beverages is primarily aimed at reducing the consumption of stimulants by consumers. The availability of alcohol in Poland is very high and, taking into account the inflation factor, without increasing excise rates, the affordability of alcoholic beverages will continue to grow – emphasized in the justification.
As noted, the goal itself is guided by an increase in the rates of excise tax on smoking tobacco and cigarettes, starting from 2023, “that is, first of all, to reduce the consumption of the above products by consumers, especially by minors” .
The state budget will benefit from the changes. As stated in the Regulatory Impact Assessment, the government assumes that in 2022, thanks to the increase, an additional 2 billion PLN will be allocated to the state budget. In 2023, state budget revenues will amount to almost 4.5 billion PLN, in 2024 – almost 6.7 billion PLN, in 2025 – about 9 billion PLN, and in 2026 – more than 11.4 billion PLN. In turn, starting from 2027, the state budget will receive an additional 14 billion PLN annually.
During the first 10 years of the new regulations taking effect, the state credit union is set to finance an additional 103 billion PLN.
The proposed law was opposed by the Liuatan ConfederationThey are protests – as confirmed a few days ago – “against the sharp increases in the excise tax on alcohol as of January 1, 2022.” “The increase is of a purely financial nature and serves to obtain from companies and citizens other huge sums for the urgent needs of the state” – the organization’s assessment.
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