The Cabinet of Ministers has approved a draft law amending the Tax Code of Ukraine, which provides for a gradual increase in excise duty on motor fuels by 2028, including gasoline by 68%.
The government’s representative in parliament, Taras Melnychuk, announced the approval of the draft law at a government meeting on Friday on Telegram.
According to his message, the draft law, in particular, proposes to set new rates of excise tax on fuel, taking into account their minimum level provided for by Directive 2003/96/EC, which comes into force on January 1, 2028. As noted in the report, a schedule of annual increases in such rates is established from July 1, 2024 to January 31, 2027 inclusive.
At the same time, MP Yaroslav Zheleznyak (Voice faction) published a schedule of rate increases to the draft law on his Telegram channel, according to which in the first half of this year the excise tax on motor gasoline will be EUR 213.5 per thousand liters, and in the second half of this year – EUR213.5/thousand liters, and in the second half of the year it should increase to EUR242.6/thousand liters and after further gradual increase in 2025-2027 in 2028 it should be EUR359/thousand liters. Thus, based on these figures, the excise tax on gasoline will increase by 68% from 2024 to 2028. The excise tax on diesel fuel, which is EUR139.5/thousand liters, should increase to EUR177.6/thousand liters in the second half of the year and to EUR330/thousand liters in 2028 (plus 136.5%).
As for liquefied gas, the figures are EUR52/thousand liters, EUR55.6/thousand liters, EUR70/thousand liters (plus 34.6%), and for alternative fuels – EUR162/thousand liters, EUR184.08/thousand liters, EUR272.4/thousand liters (plus 68%).
As reported, in mid-March 2022, the Rada adopted a law on additional tax incentives to support businesses during the war, aimed, in particular, at keeping fuel prices down. According to the law, fuel was temporarily subject to zero excise duty and 7% VAT instead of 20% for the period of martial law.
On September 21, 2022, the Rada adopted draft law No. 7668-d on the return of excise taxes on motor fuels, setting them at EUR 100 for gasoline and diesel (hereinafter referred to as per 1 thousand liters), EUR 52 for liquefied gas, butane and isobutane, and EUR 100 for alternative motor fuels and biodiesel. VAT for all fuels remained at 7%.
However, according to this document, from July 1, 2023, the level of fuel taxes returned to the pre-war level: VAT – up to 20%, excise tax on gasoline – up to EUR213, diesel fuel – up to EUR140 per 1 thousand liters.
