SCT Walk on Alcohol and Cigarettes

The law, which governs so that the rates of the Special Consumption Tax (SCT) on alcoholic beverages and cigarettes are automatically increased at the rate of the producer price index (IPP) every 6 months, generated a new rain of increases.

In addition to the increases related to the costs of alcoholic beverages and cigarettes a few days ago, there will now be an increase in the PPI.

The Turkish Statistical Institute (TUIK) announced that the 6-month PPI was 14.82 percent.

President Tayyip Erdogan had the authority to apply or not apply automatic increases. However, he did not make use of his authority. As soon as the inflation was announced, the Tax Administration (GİB) increased the SCT rates by 14.82 percent and announced it at jet speed.

HE WILL HIT THE MOST RAKI

Among the increases in the Tax on Special Consumption, the hardest hit were beverages such as raki, whiskey, gin and wine, whose special tax was determined directly by the amount set.

With the new price increases, the SCT charge of 1 liter of raki increased from 331.6 lira to 380.7 lira. The raki SCT increased by 49.1 lira per liter.

Since VAT is also applied to SCT, the total tax charge, including VAT, has increased to 58 lira. This made an increase of at least 58 lira per liter of raki inevitable.

Likewise, there was a pressure of 39 TL for 70 raki and at least 20 TL for 35 raki including SCT and VAT.

Some whiskey brands increased their products by more than 40 lira per liter the day before the SCT hike. However, it is stated that these increases may be insufficient with the new taxes.

With the new increases, the SCT on wine increased from 26.5 liras to 30.44 liras. The fixed excise tax on beer was increased from TL 5.40 to TL 6.19. However, the effect of the specific increase will be limited since 63 percent of the relative SCT is taken on the sale price of the beer.

AUGMENTED CIGARETTE SCT

The fixed and minimum fixed amounts of the SCT on cigarettes, which have been experiencing strong increases for a few days, increased by 14.82 percent.

With the new increases, the fixed and minimum fixed amount of SCT in a pack of cigarettes increased from 20.33 lira to 23.33 lira. However, since 63 percent of the relative SCT is collected on the sale price of cigarettes, this tax is above the specific minimum tax. For this reason, there was no new increasing pressures from the increase in SCT, except for low-priced cigarettes.