The Cabinet of Ministers of Ukraine has forecasted that additional payments to the 2016 national budget in the amount of UAH 18.1 billion will be seen from the increase of the excise duties on tobacco and alcohol.

This is outlined in the draft 2016 national budget published on December 11.

According to bill No. 3630 on the creation of competitive conditions in taxation and stimulation of the economic operations in Ukraine it is planned to double the excise duty on liquor and vodka, to UAH 141.06 per liter of 100% ABV in 2016, and the rate will be increased by 5% in 2017-2020, reaching UAH 171.47 in 2020.

The excise duty on dry wine will be increased by five times, to UAH 0.05 per liter, that for fortified wine and vermouth – by 50%, to UAH 5.37 per liter (to grow to UAH 6.53 by 2020), sparkling wine – by 50%, to UAH 7.80 per liter. The excise duty on beer will be doubled, to UAH 2.48 per liter, and it will be increased every year by 5% until 2020, reaching UAH 3.01 per liter.

The excise duty on cigarettes will grow by 40%, to UAH 318.26 per 1,000 cigarettes and will be increased by 7% every year, reaching UAH 429.29 by 2020. The ad valorem excise rate on cigarettes will grow by 25%, to 15% of highest retail price with VAT (12% without VAT in 2015) and it will not be changed in 2017-2020.