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Tax Gap of Heated Tobacco Products in Finland
Excise duty on tobacco is defined by the Act on Excise Duty on Manufactured Tobacco of December 29th, 1994 (1470/1994). Most tobacco products (cigarettes, cigars, cigarillos, pipe and fine cut rolling tobacco) are subject to a mixed excise system. The mixed excise tax system includes a specific tax based on unit or weight and an ad valorem tax based on the retail sale price and includes a minimum specific excise tax. Heated tobacco products were later included in the tax system, and effective January 1st, 2022, heated tobacco is subject to a specific tax based on the weight of tobacco. However, heated tobacco is subject to much lower tax rates than other tobacco products, and their rates have remained steady since their introduction in the tax system.
There is also an ad valorem tax on cigarette paper: 60% of the retail value.
Effective January 1st, 2023 – June 30th, 2023
- Heated tobacco products: EUR 30 cents per gram
- Cigarettes: EUR 9.06 cents per cigarette plus 52% of the retail sales price (RSP), with a minimum excise of 34.32 cents per cigarette
- Pipe tobacco: EUR 9.95 cents per gram plus 48% of the retail value
- Fine-cut rolling tobacco: EUR 7.35 cents per gram plus 52% of the rerail value, with a minimum excise of EUR 25.39 cents per grams
- E-liquids with or without nicotine: EUR 30 cents per mil
- Cigarette paper and other products with tobacco: 60% of the retail value
Effective July 1st, 2023 – December 31st, 2023
- Heated tobacco products: no change
- Cigarettes: EUR 9.43 cents per cigarette plus 52% of the RSP, with a minimum excise of EUR 35.36 cents per cigarette
- Pipe tobacco: EUR 10.75 cents per gram plus 48% of the retail value
- Fine-cut rolling tobacco: EUR 8.05 cents per gram plus 52% of the rerail value, with a minimum excise of EUR 27.37 cents per gram
- E-liquids with or without nicotine: no change
- Cigarette paper and other products with tobacco: no change
Sources:
Last updated Sept. 1, 2023