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Glossary · Income and taxes

Excise duty

In short: Excise duty is an indirect tax on certain goods — alcohol, tobacco, fuel and other energy products, and electricity — included in their price along with VAT.

Simply put: When you fill up the car or buy cigarettes, much of the price is tax. The producer or importer pays the excise duty, but in the end it is in the buyer's price. The more of these goods you buy, the more tax you pay without seeing it separately.

Example: A family spends €150 a month on fuel. Part of that is excise duty, and VAT is charged on the price including it.

The EU rule: the general arrangements are common: Council Directive (EU) 2020/262 covers energy products and electricity, alcohol and alcoholic beverages, and manufactured tobacco (Article 1(1)); amounts are set by each country within EU minimums.

Example: Bulgaria — under the Excise Duties and Tax Warehouses Act, Article 2, excise goods are alcohol and alcoholic beverages, tobacco products, energy products (such as fuel) and electricity.

Check in your country — Excise rates are published by the tax or customs authority.

Source: Council Directive (EU) 2020/262: https://eur-lex.europa.eu/eli/dir/2020/262/oj

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