Closing the duty-free scheme
On October 1, 2023, the Law of Ukraine “On Amendments to the Customs Code of Ukraine and other laws of Ukraine on combating illicit trafficking in tobacco products” (hereinafter referred to as the Law), or as its authors call it, “The Law on Closing the Duty-Free Scheme” came into force.
Thus, until the termination or cancellation of martial law on the territory of Ukraine, introduced by the Decree of the President of Ukraine “On the introduction of martial law in Ukraine,” the following are prohibited:
1) placement in the customs regime of duty-free trade and sale (supply) to duty-free shops, as well as placement in them of goods produced in Ukraine, classified in the commodity headings: tobacco and industrial tobacco substitutes; products containing nicotine or without nicotine, intended to be inhaled without burning as well as other nicotine-containing products designed to provide nicotine into the human body.
2) sale by duty-free shops of tobacco products to one person per day in a volume exceeding 50 cigarettes or 10 cigars or 20 cigarillos (weighing no more than 3 grams each) or 50 grams of tobacco, or these products in a set with a total weight of more than 50 cigarettes;
3) sale by duty-free shops of alcoholic beverages to one person per day in a volume exceeding 2 liters of alcoholic beverages with an alcohol content not exceeding 22%, or 1 liter of strong alcoholic beverages (with an alcohol content of more than 22%).
Exceeding the volume of sales of tobacco products and/or alcoholic beverages to one person within one day established in paragraphs 2 and 3 entails administrative liability in the form of a fine in the amount of eight hundred to one thousand tax-free minimum incomes of citizens.
The settlement document for the sale by duty-free shops of the goods specified in paragraphs 2 and 3 must contain the details of the passport document of the citizen - the buyer of such goods, which are necessarily transferred to the accounting system of data registrars of settlement transactions of the central executive body implementing state tax policy.
Until the termination or cancellation of martial law in Ukraine, introduced by the Decree of the President of Ukraine "On the introduction of martial law in Ukraine", the import into the customs territory of Ukraine of goods classified in the following headings is prohibited: tobacco and industrial tobacco substitutes; products containing nicotine or without nicotine, intended to be inhaled without burning; other nicotine-containing products intended to supply the nicotine to the human body, originating from the Republic of Belarus.
Thus, the Law makes it impossible for the existence of schemes for the illegal sale of cigarettes and alcoholic beverages for the duration of the legal regime of martial law. Payment of taxes to the budget is a fundamentally important tool for overcoming the armed aggression of the Russian Federation.
Senior Lawyer
Oleh Lyhin
