Saeima supports raising excise taxes on alcohol, tobacco, sweetened drinks

RIGA - Saeima on Thursday passed amendments to the excise duty law, which provide for an increase in excise duties on alcohol, tobacco and sweetened beverages.

The draft law is related to the draft law on the state budget for 2026 and the budgetary framework for the next three years.

The amendments foresee a gradual increase in excise duties on several groups of goods, including alcoholic beverages, tobacco products, non-alcoholic and energy drinks, starting next year. After two years, the reduced rate for petroleum products used in free ports and special economic zones will be phased out.

From March 15 next year, excise duty on spirits will increase, while from March 1, 2028, excise duty on all alcoholic beverages will rise, with the end price of spirits increasing by EUR 0.51, of wine by EUR 0.15 to EUR 0.30 and of beer by EUR 0.03 per bottle.

Next year and from 2027, a faster increase is foreseen for all tobacco products - 5 percent more than previously planned. Compared to this year's prices, the price of a pack of cigarettes will rise by EUR 2.20 to EUR 7.50 from 2028, while for chewing tobacco the increase is planned at EUR 0.35 per pack and for a two-milliliter pack of e-liquid it will be EUR 0.15.

From 2028, the tax will also increase on sweetened beverages and energy drinks will be subject to a separate excise duty rate.

It is also foreseen that from 2028, non-alcoholic carbonated beverages prepared on the premises of catering establishments will be subject to excise duty. Until now, both non-carbonated and carbonated beverages prepared for immediate consumption at the point of sale were exempt from excise duty.

Petroleum products will also be affected by the excise duty changes, and the reduced rate for petroleum products used in free ports and special economic zones is to be abolished from 2028. To promote the use of renewable and more environmentally friendly energy in machinery and equipment, including electricity, the general rate of excise duty is to be applied in place of the current reduction. The current excise duty relief on fuel will be available to businesses until the end of 2027.