SOFIA – The price of cigarettes in Bulgaria is set to increase by approximately 2.40 leva per pack starting April 1, following an adjustment in excise duty under a new directive issued by the European Commission.
The measure, incorporated into Bulgaria’s draft budget for 2025, was recently adopted by the National Assembly.
The excise duty revision aligns with the European Commission’s updated minimum tax rates on tobacco products, which will double the current minimum excise duty on cigarettes from 90 euros to 180 euros per 1,000 cigarettes, or 3.60 euros per pack.
In Bulgaria, where tobacco prices are currently around 56.6% of the EU average, the minimum excise duty will be adjusted accordingly. As a result, the new tax rate will be set at 153.96 euros per 1,000 cigarettes, translating to 6.02 leva per pack, up from the current 4.05 leva.
The increase in excise duty will lead to a price hike of approximately 2.40 leva per pack after applying the standard 20% VAT.
The Bulgarian Ministry of Finance has outlined three possible approaches for implementing the new rates: a series of three incremental hikes, a sharp one-time rise, or maintaining the existing annual increase schedule.
Further Price Hikes from May 1
In addition to the April increase, a second wave of excise duty hikes will take effect on May 1, further raising the cost of cigarettes and other tobacco products.
The 2025 budget estimates that this move will generate an additional 203 million leva in revenue in 2025 alone, with total projected earnings of 953 million leva from 2025 to 2028.
The proposed excise tax from May 1 includes a charge of 131 leva per 1,000 cigarettes, plus 22% of the selling price, with a minimum threshold of 210 leva per 1,000 cigarettes.
This adjustment will result in an excise tax increase of approximately 15 cents per pack, with VAT raising the total price increase to around 20 cents per pack.
Heated Tobacco and E-Cigarettes Also Affected
The government’s excise tax reforms extend beyond traditional cigarettes. From May 1, excise duties on heated tobacco products and electronic cigarettes will also be raised, in line with efforts to harmonize Bulgaria’s tobacco taxation with EU standards.
While specific tax details for these products have yet to be fully outlined, the price adjustments are expected to impact a broad range of consumers.
Economic and Public Health Considerations
The planned excise duty increases are part of Bulgaria’s broader fiscal strategy to boost government revenue while aligning with EU taxation policies.
However, the tax hike also serves a public health purpose by discouraging smoking through higher retail prices. The World Health Organization (WHO) has consistently advocated for higher tobacco taxes as an effective measure to reduce smoking rates.
While the price increases may encourage some smokers to quit or cut back, tobacco industry representatives and consumer advocates have warned that the move could lead to a surge in illicit cigarette sales, as consumers seek cheaper alternatives through the black market.
With the excise duty hikes set to take effect in April and May, Bulgarian smokers are bracing for a significant uptick in cigarette prices, marking one of the most substantial tobacco tax increases in the country’s history.
This article was created using automation technology and was thoroughly edited and fact-checked by one of our editorial staff members