Since April 1, Russia has set a minimum price for cigarettes. A corresponding law aimed at tightening the pricing policy for the sale of tobacco products was signed at the end of December last year by Russian President Vladimir Putin.
The minimum cost of cigarettes, for the calculation of which a special formula will be used, from April 1 to December 31, 2021 will be 108 rubles. This is stated in the message of the Ministry of Agriculture, posted on the website of the department.
How will the minimum price for tobacco products be calculated?
The entry of the minimum cost of cigarettes is fixed in the federal law of December 30, 2020 N 504-FZ.
The minimum price for tobacco products is calculated using a special formula based on the minimum value of the excise tax rate for a pack of tobacco products, the value added tax rate and the multiplying coefficient. The single minimum cost of tobacco products is introduced from the date of application of the excise duty on tobacco products established by the Tax Code of the Russian Federation. The Ministry of Agriculture should calculate this indicator and publish its value.
Sellers are given three months to sell tobacco products that were produced or imported earlier at maximum retail prices below the single minimum applicable at the time of sale. At the same time, this price cannot be lower than the single minimum price of tobacco products in effect before the date of application of the new value, is stipulated in the law.
Prior to the adoption of the new law, the minimum cost of cigarettes was 75% of the maximum retail price, while for each brand of tobacco products it was calculated separately. The producers set this indicator themselves, taking into account the excise tax, which is paid to the budget.
Will cigarettes rise in price due to the new law?
The adoption of the new law is primarily aimed at combating illegal tobacco products. Seeing a too cheap pack, consumers will immediately be able to understand that they are dealing with an illegal product.
In general, the introduction of a minimum price for cigarettes will not lead to their rise in price, since almost all legal products now cost more than 107 rubles, Rossiyskaya Gazeta reports, citing data from Russian retailers. Earlier, the Ministry of Finance calculated that due to an increase in excise tax by 20%, the average cost of a pack of cigarettes in 2021 will increase from 120 to 140 rubles.