Estonia: Government to raise alcohol, tobacco, fuel taxes by 5% per year

Estonia’s Ministry of Finance has proposed raising excise duties on alcohol, tobacco, and fuel by 5% per year over 2025-2028, ERR reports. The tax hikes would take effect as of 1 July 2025. The bill would raise alcohol and tobacco taxes more than initially planned for 2025 and 2026. Estonia’s excise tax on petrol has remained unchanged since 2018. The Finance Ministry estimated that tax hikes would raise petrol prices by EUR 0.063 per litre in 2025 and by less than EUR 0.04 per litre in subsequent years. The excise duty on beer would rise to EUR 0.37 per litre and on strong alcoholic beverages to EUR 4.36 per 0.5 litres as of 1 July 2025. The price of a pack of 20 cigarettes would rise by 11.4% on average. The government has given just three days for stakeholders to express feedback on the proposed tax changes.