New bill to increase excise tax on oil products

TIRANA, April 26 – The Albanian government is drafting a new law to increase the excise tax rate for some oil products. The Finance Ministry bill envisages imposing excise tax on low quality fuels used for heavy industry, agriculture and greenhouse heating which are expected to increase budget revenues by an estimated 4.3 billion Leek (43 million dollars).
Virgin oil, currently excise-free, will be taxed at 70 Leek per litre. Meanwhile, the excise tax for the kerosene will be 20 Lek per litre.
Increases are also expected for poor quality diesel, heavy oils and residual oil whose excise taxes will each be 37 Lek per litre, the same as petrol and D1, D2 diesel. Their current excise tax rate is 13 Lek per litre.
The bill includes products extracted from underground Albania, managed by the ARMO oil refinery.
Currently, the excise tax rate for diesel and petrol is 37 Lek per litre under a government decision made in January 2009. The increase of the excise tax rate by at least 6 Lek per litre raised budget revenues by 20 million dollars in 2009.
The increase will also affect cyclic and acyclic hydrocarbons including ethylene and benzene which will also each be at a 37 Lek excise tax rate per litre from 13 Lek currently.
The Finance Ministry bill envisages excise tax increases even for plastic raw materials used by export and construction industries.
Cardboard, glass, car batteries, fire-extinguishers and bulbs will be included in the excise tax plan for the first time.
Plastic and glass packaging as well as tires will also have an excise tax imposed because of their environmental impact. The proposal on the plastic packaging excise is 100 Lek/kg.
The draft also envisages that prices of excise goods such as cigarettes, alcohol and coffee will be stamped on the packaging of these products.
The bill is expected to be approved by government after being discussed with interest groups in the Consultative Council.