Russian Finance Ministry Expects Higher Tax on Nicotine E-Liquid to Generate RUB10 Billion

The Russian Ministry of Finance estimates that doubling the tax on nicotine e-liquids will generate RUB 10 billion in revenue.

According to recent news from TASS, the Russian Ministry of Finance estimates that doubling the tax on nicotine e-liquids will yield approximately RUB 10 billion (around 800 million yuan). 

Deputy Minister Alexey Sazanov stated at a plenary session of the Federation Council: "We expect the revenue to be around RUB 10 billion. Currently, this tax rate is effectively a ban, and we believe it will help increase budget revenues and reduce the consumption of nicotine products." This was his response to a question regarding the expected fiscal benefits of raising the tax rate on nicotine e-liquids. 

Previously, the Federation Council approved an increase in tobacco product tax rates starting in 2024. 

According to the newly passed law, the tax rate for cigarettes and cigars will reach RUB 2813 per thousand sticks plus 16% of the calculated price, but not less than RUB 3820 in 2024; in 2025, the tax rate for cigarettes will increase to RUB 2926 per thousand sticks, plus 16% of the calculated price (not less than RUB 3973); and in 2026, the tax rate for cigarettes will further increase to RUB 3043 per thousand sticks, plus 16% of the calculated price (not less than RUB 4132). 

Currently, the tax rate for cigarettes is RUB 2603 per thousand sticks plus 16% of the calculated price, but not less than RUB 3536.

As for the tax rate on nicotine e-liquids, it will be RUB 42 per milliliter in 2024, RUB 44 per milliliter in 2025, and RUB 46 per milliliter in 2026.