The Bulgarian Parliament’s budget committee has approved a legislative framework to gradually increase excise duties on tobacco products starting March 2023. This phased tax hike, scheduled to run through January 2026, aims to generate substantial state revenue while curbing tobacco consumption.
Under the approved plan, a standard pack of cigarettes is expected to rise by an average of 20 stotinki. Other tobacco categories, including heated tobacco products, will face steeper price adjustments.
The Ministry of Finance estimates the tax calendar and accompanying VAT will inject over 660 million leva into the state treasury over the implementation period. To protect public funds, specific excise duties are being prioritized over proportional rates, ensuring stable government revenue regardless of corporate pricing strategies.
Deputy Finance Minister Lyudmila Petkova emphasized that cigarettes were assigned the smallest relative tax increase specifically to mitigate the risk of black-market smuggling, which is significantly higher for cigarettes than for heated tobacco.
During parliamentary debates, health advocates pushed for even stricter measures. Dr. Masha Gavrailova proposed a 15% tax hike instead of the proposed 5%, arguing it would raise an additional 92 million leva and reduce cigarette consumption by 77 million packs.
Industry representatives, including Virginia Dzhevelekova, supported the gradual tax calendar but urged policymakers to consider the varying risk profiles and economic contributions of different tobacco products moving forward.
