Russia

Background

Vapor products have been added to the list of excisable products contained in Article 181, paragraph 1 of the Tax Code of the Russian Federation. The amendments to Parts 1 and 2 of the Tax Code were approved on November 30, 2016.

The new tax categories added were 1) electronic nicotine delivery systems, 2) liquids for electronic nicotine delivery systems and 3) tobacco intended for consumption by heating.

The tax on tobacco products intended for consumption by heating went into effect on January 1, 2017 at a rate of RUB 4800 per kilogram.

Adjustment of tax rates

Since 1 January 2019 the current tax rate has been RUB 5808 per kilogram. A mechanism is in place to adjust the rates every year on January 1. In January 2020 the tax on heated tobacco will increase to RUB 6040 per kg and in 2021 the rate is scheduled to rise to RUB 6282 per kg.

There is also a tax applied to the device used to heat the tobacco mixture. The current rate of 48 rubles for each device is scheduled to rise to RUB 50 in 2020 and to RUB 52 in 2021.