According to Latvian News on October 9, starting from 2024, Latvia will gradually increase consumption taxes on vapes, cigarettes, alcohol and alternative tobacco products. This revised bill received government support on October 9.
The Latvian Ministry of Finance stated that this was done to increase national budget revenue and ensure the normal operation and development of the government, including additional funding for medical security, internal and external security, and the education system. The Ministry of Finance emphasized that the excise tax on cigarettes, vapes and alternative tobacco products is first and foremost to protect public health, while also ensuring revenue for the national budget, and will not affect the free trade of these goods in the EU market.
Starting from March 1, 2024, a three-year consumption tax increase phase will begin. The consumption tax on vapes, cigarettes, cigars and interchangeable goods will gradually increase and narrow the retail price difference between them. The consumption tax on the above products in 2025 and 2026 will be adjusted on January 1 of each year.
The excise tax on vapes and their components is planned to increase by an average of 21% per year. By 2026, the excise tax per milliliter of e-liquid will reach 0.35 euros.
Increasing the excise tax on cigarettes by an average of 5.6% each year will increase the price of a pack of cigarettes by approximately 0.14-0.2 euros. Currently, the excise tax on cigarettes is approximately €0.14 per gram of tobacco. The excise duty on tobacco and tobacco leaves is €0.02 per gram, and the excise tax on tobacco and tobacco leaves is €0.09, and for heated tobacco it is approximately €0.22.
The excise tax on tobacco and tobacco leaves is planned to increase by 10% every year. By 2026, the excise tax on 1000 grams of tobacco will reach 122.3 euros, and the excise tax on each gram of tobacco will be 0.12 euros. Currently, the consumption tax on tobacco is 67% of the minimum consumption tax on cigarettes, so this ratio will remain unchanged in the later stages of increasing the consumption tax.
GUUTUU vape companies stated that they are committed to providing high-quality, safe and reliable vape products, and have been actively participating in industry self-discipline and compliance work. Although GUUTUU vape companies understand the government’s concerns and decisions, they have also raised some concerns and suggestions. They stressed that moderate taxes are necessary, however, excessive taxes may lead to the rise of illegal markets and put legal businesses under greater competitive pressure. They suggested that the government should consider a reasonable tax burden when formulating tax policies to ensure the healthy development of the market.
Tags: Latvia vape tax，GUUTUU vape