Poland

The Polish Parliament approved Amendments to the Act on Excise Duty (the “Act”) which introduced taxes on both electronic cigarettes and heated tobacco products.

Revisions to the Act include a new tax category – novel products, a term popularized in the EU’s updated Tobacco Products Directive (TPD2). Novel products are defined in the Act as “a mixture which contains tobacco or raw tobacco” as well as a “separate liquid for electronic cigarettes”.

The weight of the tobacco mixture, expressed in kilograms, is set in the legislation as the taxable base for novel products, which is consistent with the emerging trend in heated tobacco taxation. The excise duty rate for novel products has been fixed at PLN 141.29 per kilogram and 31.41% of the weighted average price (“WAP”) of smoking tobacco, which is to be determined based on sales data for the first ten months of the year preceding the calendar year for which the WAP of smoking tobacco is calculated.

The revised Act requires that the weight of novel products, expressed in grams, be printed on the package.

The Amendments were approved in December 2017 and the taxes on novel products went into effect in 2018. However, until 31 December 2018, the rates of excise on novel products will zero.