Revenues from excise taxes in the Serbian budget in 2022 were lower than expected

, News

Revenues from excise taxes in the Serbian budget in 2022 were lower than expected due to the reduction of taxes on oil derivatives, and the inflow on that basis will decrease this year as well, writes the monthly “Business and Finance”.

A lower collection is also expected from excise duties on alcoholic beverages and coffee, while revenue from excise duties on tobacco and energy is expected to increase. Nevertheless, when the line is drawn, the total inflows from excise taxes will continue to fall this year, primarily due to the adjustment of the excise policy to rising energy prices and inflation.

Based on the rebalancing of the budget for 2022, revenues from excise taxes in 2022 will amount to about 336.8 billion dinars, which is 0.8 billion dinars less than the original budget projection. Excise duties on oil derivatives were reduced by 9.2 billion dinars, excise duties on tobacco products were increased by five billion, while other excise duties on energy, alcoholic beverages and coffee were increased by 3.4 billion dinars.

Revenues from excise duties on oil derivatives will be lower due to the government’s decision to first limit retail prices and then lower fuel taxes, in order to alleviate the consequences of the energy crisis. The government applied such measures several times during 2022, reducing the excise duty on oil derivatives in the range of 10 to 20 percent, which is the legal maximum.

The Fiscal Council estimates that lowering excise duties on oil derivatives cost the state more than 20 billion dinars in 2022.

That independent body assessed that measures such as limiting retail prices and lowering taxes on oil derivatives are relatively easy to implement, but that citizens with higher incomes benefit more from them. This is also confirmed by data on household consumption in Serbia, according to which the poorest households spend only 3.6 percent on fuel, while those with the highest income allocate more than 11 percent of total consumption for these purposes.

An additional problem is that measures to alleviate the energy crisis are not accompanied by incentives to reduce consumption. The Fiscal Council therefore proposes that instead of a price policy aimed at all citizens, a system should be established that would help those who are the most energy vulnerable.

Budget revenues from excise taxes in 2023 are projected at about 322 billion dinars, which is significantly less compared to last year’s revenues. The additional reduction is a consequence of the announced adjustment of the excise policy to rising energy prices and inflation, the Fiscal Council states.

In the explanation of the budget for 2023, it is announced that further application of lower excise duties on oil derivatives by 10 percent, as well as that there will be no regular increase of other excise duties based on the general trend of prices in 2022.

Excise duties on oil derivatives are the only category of tax revenue for which a year-on-year reduction is planned, from about 177 billion dinars in 2022 to 169 billion dinars the following year. The Fiscal Council reminds that at the beginning of 2022 there was no regular increase in excise taxes, so that in March excise taxes on motor fuel would be temporarily reduced by 20 percent, then by 15 percent, and from mid-August a reduction of 10 percent of the initial amount will apply.

In contrast to the decrease in income from excise duties on oil derivatives, the budget for 2023 projects a slight increase in income from excise duties on tobacco products, by about two billion dinars. It is expected that these revenues will reach around 121.5 billion dinars, where the most significant item is cigarettes, which make up 98 percent of the total excise revenues from processed products.

Based on the rebalancing of the budget for 2022, revenues from excise taxes in 2022 will amount to about 336.8 billion dinars, which is 0.8 billion dinars less than the original budget projection. Excise duties on oil derivatives were reduced by 9.2 billion dinars, excise duties on tobacco products were increased by five billion, while other excise duties on energy, alcoholic beverages and coffee were increased by 3.4 billion dinars.

An additional problem is that measures to alleviate the energy crisis are not accompanied by incentives to reduce consumption. The Fiscal Council therefore proposes that instead of a price policy aimed at all citizens, a system should be established that would help those who are the most energy vulnerable.

Budget revenues from excise taxes in 2023 are projected at about 322 billion dinars, which is significantly less compared to last year’s revenues. The additional reduction is a consequence of the announced adjustment of the excise policy to rising energy prices and inflation, the Fiscal Council states.

In the explanation of the budget for 2023, it is announced that further application of lower excise duties on oil derivatives by 10 percent, as well as that there will be no regular increase of other excise duties based on the general trend of prices in 2022.

Excise duties on oil derivatives are the only category of tax revenue for which a year-on-year reduction is planned, from about 177 billion dinars in 2022 to 169 billion dinars the following year. The Fiscal Council reminds that at the beginning of 2022 there was no regular increase in excise taxes, so that in March excise taxes on motor fuel would be temporarily reduced by 20 percent, then by 15 percent, and from mid-August a reduction of 10 percent of the initial amount will apply.

In contrast to the decrease in income from excise duties on oil derivatives, the budget for 2023 projects a slight increase in income from excise duties on tobacco products, by about two billion dinars. It is expected that these revenues will reach about 121.5 billion dinars, where the most significant item is cigarettes, which make up 98 percent of the total excise revenues from tobacco products.

As explained in the Fiscal Council, in order to reach the minimum amount of excise duty on tobacco products of 1.8 euros per pack prescribed by the EU Directive, the existing law stipulates that until 2025, the specific part of the excise duty will be increased twice a year by 1, 5 dinars. Therefore, this amount will be 82.75 dinars from January 2023, and 84.25 dinars from July. In addition, according to the current regulations, these amounts are increased if the general increase in prices in the previous year amounted to more than two percent.

Revenues from other excise duties on electricity, alcoholic beverages and coffee for the next year are projected at around 41.6 billion dinars, which is an increase of around four percent compared to the expected revenues in 2022. The budget plan implies that excise taxes on electricity will increase next year, while the total amount of excise taxes on alcoholic beverages and coffee will decrease.

Approximately half of the revenue from other excise duties is made up of excise duties on electricity, and the Fiscal Council estimates that they will exceed 20 billion dinars this year, while the payment of excise duties on alcoholic beverages and coffee will amount to approximately 17.7 billion dinars, Novi Magazin writes.

error: Content is protected !!