The new rates are outlined in this article, which specifically addresses the increase in tobacco excise duty. The procedure for increasing these rates has been slightly different from that of other excise duties. According to the Tax Plan 2023, the rates were originally set to increase from 1 April 2024; however, the Tax Plan 2024 raises these rates even further.
Additionally, the bill includes increases in consumption taxes. These increases are not derived from the legislation following the Tax Plan 2024 but rather from the Tax Plan 2023. The effective date for the changes in consumption tax rates is also 1 January 2024.
Finally, the article outlines key considerations for those trading in these goods.
Beer - Article 7 Excise Duty Act
Currently,
the excise duty rate for beer is still determined based on degrees Plato.
However, according to the 2022 Excise Guidelines Implementation Act, a
transition to a different tax base will occur from 1 January 2024. The rate
will then be determined based on the alcohol percentage.
- Under this new tax base, the excise duty rate for beer will be set at €7.49 per hectolitre per volume percentage of alcohol. This amount will be increased to EUR 8.12 as stipulated in the bill.
- For beer produced by so-called small breweries, the excise duty rate will rise from EUR 6.93 to EUR 7.51.
Wine - Article 10 Excise Duty Act
The excise duty rate for still and sparkling wine, with an alcohol content not exceeding 8.5%, is increased from EUR 44.24 to EUR 47.95 per hectolitre.
For still and sparkling wine with an alcohol content exceeding 8.5%, the rate is increased from EUR 88.30 to EUR 95.69 per hectolitre.
Intermediate Products - Article 11d Excise Duty Act
For
excise duty on intermediate products with an alcohol content not exceeding 15%,
the excise duty rate is increased from EUR 105.98 to EUR 114.85 per hectolitre.
For excise duty on intermediate products with an alcohol content exceeding 15%, the excise duty rate is increased from EUR 149.30 to EUR 161.80 per hectolitre.
Other Alcoholic Products - Article 13 Excise Duty Act
The
excise duty rate for other alcoholic products under the Excise Duty Act will be
increased from EUR 16.86 to EUR 18.27 per hectolitre per volume of alcohol.
Mineral Oil: Fuel Oil - Section 27 Excise Duty Act
The rate for fuel oil— if implemented by the plan —will be aligned with the rate for gas oil (including a conversion factor for the difference in litres and kilograms). The excise duty rate for fuel oil per 1,000 kilograms will be increased from EUR 41.31 to EUR 595.57.
Importantly, the bill also stipulates that Section 84a of the Excise Duty Act does not apply to this increase. This means, in brief, that regarding the availability of the mineral oils in question in a storage facility (when the increase takes effect), the old rate will apply (subject to conditions) instead of the increased rate.
Cigarettes and Smoking Tobacco - Section 35 Excise Duty Act - Entry into Force 1 April 2024
It has already been decided in the Tax Plan 2023 to increase the excise duty on cigarettes and smoking tobacco, effective 1 April 2024. The Tax Plan 2024 subsequently proposed an additional increase in the rates. Compared to the current legal text, the following rate increases have been proposed:
- For cigarettes, the specific excise duty per 1,000 pieces will be increased to EUR 362.12, with the minimum excise duty amount being raised to EUR 390.4
- For smoking tobacco, the specific excise duty will be increased to EUR 346.98 per kilogram.
Consumption Tax
The 2023 Tax Plan also impacts consumption tax. Based on the Plan, mineral water (commodity code 2201) will be exempt from consumption tax as of 1 January 2024. Additionally, the rate for non-alcoholic beverages will be increased. The rate per hectolitre will rise from EUR 8.83 to EUR 26.13 per 100 litres, effective 1 January 2024.
Key Considerations for Upcoming Changes
Although the Senate has yet to consider the bill, it is anticipated that the bill will be passed and implemented without delay. This means that the new excise duty rates will take effect from 1 January 2024. However, be cautious, as discussions in the Senate may still lead to changes.
Overall, excise duty rates will be increased, with the rate for fuel oil being particularly significant; this rate will be more than 15 times higher. If you hold licenses for these products, such as an authorization for a fictitious excise goods location or an establishment for consumption tax, the rate change will impact the reference amount on which the guarantee is calculated, thereby affecting the amount of guarantee you have provided. Therefore, it is essential to recalculate in a timely manner, contact Customs, and have the security in your authorizations adjusted.
If you have any questions following this article or require support in recalculating the reference and security amounts, please feel free to contact us.