Russia to raise tobacco excise tax in 2024, excluding e-cigarettes (with full regulatory overview)

On July 14, Russian media reported that the Budget and Tax Committee of the State Duma approved relevant amendments to the "Domestic Tax Law," which will raise the excise tax on spirits, cigarettes, and automobiles starting January 1, 2024.
According to reports, Deputy Minister of Finance Alexey Sazanov pointed out that the excise tax rates will be adjusted according to the inflation level predicted by the Ministry of Economic Development. The subsequent growth rate of the excise tax is expected to be 5% in 2024, 4% in 2025, and 4% in 2026. Alexey Sazanov noted that the excise tax on spirits is expected to be raised by 5% based on inflation forecasts.
It is worth noting that the scope of this excise tax increase does not include e-cigarettes. According to previous reports from Russian media, Russia has already determined and announced plans to raise the excise tax on e-cigarettes.
Specifically, starting March 1 of this year, the excise tax on e-cigarette devices has been canceled, and the excise tax on e-cigarettes has been increased by 11%, from 18 rubles to 20 rubles/ml. Next year, it will further increase to 21 rubles/ml, and in 2025 it will rise to 22 rubles/ml.

Currently, Russia's regulatory policies for e-cigarettes have become relatively clear, including achieving full traceability of products through honest labeling and combating counterfeit goods; implementing entry regulation for production and circulation through the "Comprehensive Regulation of the Tobacco Market"; and expected standards for additives and flavor regulations to be released before September. Key timelines are as follows:

● December 15, 2022: Manufacturers and importers register in the "honest labeling" system;
● December 25, 2022: Manufacturing and importing e-cigarettes must label products with "honest labeling";
● March 1, 2023: Wholesalers and retailers register in the "honest labeling" system;
● April 1, 2023: "Honest labeling" data for e-cigarettes uploaded; products without labeling cannot pass customs;
● April 2023: Amendments passed (flavors, sales channels, minimum price);
● June 1, 2023: Operational restrictions on e-cigarette retail channels come into effect;
● June 2023: "Comprehensive Regulation of the Tobacco Market" passed;
● September 1, 2023: Excise tax increase; minimum price comes into effect; flavor restrictions start; license application begins;
● December 1, 2023: E-cigarettes without "honest labeling" will be prohibited from circulation;
● March 1, 2024: Comprehensive accounting and regulation of e-cigarettes from production, distribution, to retail.