Excise taxes on tobacco products and alcoholic beverages, including beer, will rise in 2025 as part of a measure by the Ministry of Finance to boost government revenue. This increase is expected to make these goods more expensive for consumers.

The excise tax on alcoholic drinks, including beer, is set to increase by 10 to 15%, a change that has already received approval from the majority of political forces in parliament, as well as trade unions and employer organizations, according to Finance Minister Lyudmila Petkova. Currently, excise taxes on these products in Bulgaria are at the minimum EU levels, as noted during parliamentary discussions.

At present, excise taxes on alcoholic beverages vary depending on alcohol content, ranging from 90 leva to 1,100 leva per hectoliter, while wines are exempt from excise duties. Homemade brandy is taxed at 550 leva per hectoliter of pure alcohol, and beer is taxed at 1.50 leva per hectoliter, with a reduced rate of 0.75 leva for small breweries. Despite these increases, alcoholic drinks account for just 5% of total excise revenue.

A more significant increase is planned for tobacco products. The Finance Ministry is proposing to fast-track the increases originally set for 2025 and 2026. Specifically, the excise tax on cigarettes will rise from 194 leva for 1,000 cigarettes to 211 leva, which will likely increase the cost of a pack by 70-80 stotinki. The excise duty on smoking tobacco will also see a hike, moving from 184 leva per kilogram to 222 leva, while the tax on heated tobacco will jump from 331 leva to 400 leva per kilogram. The excise tax will also rise for other smoking products, including those with or without nicotine, such as herbal mixtures. The Ministry expects that these accelerated increases will generate over 230 million leva in revenue in 2025.

Despite these planned increases, the Ministry of Finance asserts that the rise in excise duties on alcohol and cigarettes will not have a pro-inflationary effect, meaning it will not hinder the country’s goal of maintaining 2% inflation as part of its preparations for joining the eurozone.

Source: econ.bg