1. What changed on April 1, 2025?
With the 2025 State Budget—adopted on 18 February and promulgated in the “State Gazette”—the National Assembly introduced substantial clarifications to the Excise Duties and Tax Warehouses Act (ЗАДС). The main amendments are in Articles 37–39 and introduce a phased, yet sharp increase in excise rates for*
- cigars and cigarillos
- all forms of “loose” tobacco;
- heated products (with or without tobacco);
- e-cigarette liquids;
- nicotine refills and tobacco substitutes;
- traditional cigarettes (via a new five-year scale)
The first increase took effect on May 1, 2025, not on April 1 as initially announced, in order to give businesses a one-month “grace” period dariknews.bg. The table below summarizes the starting rates for 2025 (the full schedule through 2029 is in the facsimile of the statutory text).
| CATEGORY ( ART. ) | Rate as of May 1, 2025 |
|---|---|
| Cigars and cigarillos (Art. 37) | BGN 396 / 1,000 pieces |
| Smoking tobacco (Art. 38, para. 1) | BGN 222 / kg |
| Heated tobacco products (Art. 38, para. 2) | BGN 400 / kg |
| E-cigarette liquids (Art. 38, para. 3) | BGN 0.45 / ml |
| Nicotine refills ≤ 20 mg (Art. 38, para. 4) | BGN 30 / kg |
| Nicotine refills > 20 mg (Art. 38, para. 5) | BGN 115 / kg |
| Heated non-tobacco products (Art. 38, para. 6) | BGN 400 / kg |
| Cigarettes — specific excise (Art. 39, para. 1, item 1) | BGN 131 / 1,000 pieces |
| Cigarettes — ad valorem excise | 22% of the sales price |
| Minimum total for cigarettes (Art. 39, para. 2) | BGN 210 / 1,000 pieces |
Under the same schedule, the rates will rise each year through 2029, when, for example, vape liquids will reach BGN 0.66/ml, and the minimum total excise for cigarettes will be BGN 258/1,000 pieces.
2. How significant is the increase compared to 2024?
- Heated tobacco: from BGN 331 to BGN 400/kg (+21%).: от 331 лв. на 400 лв./кг (+ 21 %)
- E-cigarette liquids: from BGN 0.40 to BGN 0.45/ml (+12.5%).
- Cigarettes: the specific component rises by only BGN 10, while the overall minimum goes from BGN 202 to BGN 210/1,000 pieces (+4%).
The conclusion is clear: alternative nicotine products are becoming more expensive significantly faster than conventional cigarettes.
3. Bulgaria versus Europe: Where do we stand in 2025?
3.1 Excise duties on vape liquids
Recalculated in euro (BGN 0.45 ÷ 1.95583 = ~ € 0.23/ml), the new Bulgarian rate for e-liquids is among the three highest on the continent:
| Country | Rate 2025 | Nicotine / Nicotine free |
|---|---|---|
| Finland | € 0,30/ml | No distinction |
| Germany | € 0,26/ml | No distinction |
| Bulgaria | € 0,23/ml | Same for both |
| Denmark | ~ € 0,27/ml (DKK 2) | No distinction |
| Poland | € 0,21/ml (от март 2025) | No distinction |
| Spain | € 0,15–0,20/ml, higher for > 15 mg nicotine | |
| Sweden | € 0,017–0,034/ml (differentiated) | |
| Ireland | € 0,50/ml (starting 1st of January 2025) |
Important: Bulgaria makes no distinction between nicotine and nicotine-free liquids, whereas most countries either apply a lower rate/exempt 0 mg liquids (Spain, Italy, Sweden), or plan a progressive tax based on nicotine content (the forthcoming model of the United Kingdom)
3.2 Excise duties on cigarettes
According to Tax Foundation Europe, Bulgaria remains the country with the lowest total excise burden on a pack of cigarettes—€2.02 excluding VAT (≈ €2.54 including VAT), compared with €10.71 in Ireland. Even after the May increase to a minimum of BGN 210/1,000 pieces (~ €107), the gap with the EU average (~ €145) is substantial.
4. Why is the excise on vape liquids so high?
According to the Ministry of Finance, the goal is alignment with the German model and “neutral” treatment of all nicotine products. Critics, however, point out:
- Reverse price incentive — when e-liquid costs more while cigarettes remain cheap, smokers have a weaker incentive to switch to a less harmful alternative.
- Lack of differentiation — nicotine-free liquids aid gradual cessation, but here they are taxed at the same rate.
- Risk of a gray market — experience in Denmark and Germany shows an increase in illicit liquids after large excise shocks.
5. What does the schedule through 2029 mean?
| Year | E-liquid ( BGN/ml ) | Cigarettes - minimum ( BGN/1000 ) |
|---|---|---|
| 2025 | 0,45 | 210 |
| 2026 | 0,48 | 222 |
| 2027 | 0,54 | 234 |
| 2028 | 0,60 | 246 |
| 2029 | 0,66 | 258 |
In percentage terms: vape liquids will rise by 47% over five years, while the minimum excise for cigarettes—only by 23%. Meanwhile, Germany plans 23% by 2026 but already starts from a higher base; Ireland comes in at €0.50/ml as early as 2025.
6. Potential impact on the market and public health
- Revenue: The Ministry expects an additional BGN 203 million in 2025 alone from tobacco products.
- Prices: The average pack of cigarettes increases by ~BGN 0.50; 10 ml of e-liquid—by BGN 0.50 (up to BGN 4.50 in excise alone).
- Shift to vaping: Reverse economic logic—the price gap between roll-your-own cigarettes and vaping is narrowing, which may discourage some smokers from switching.
- Gray market: According to the Association of Smokeless Products, illicit liquids already account for 15% of the market; their share is expected to grow by a further 5–7% in 2025 (an estimate based on German experience).
7. What’s next at the EU level?
In July 2025, the European Commission presented a draft of the new Directive on the taxation of tobacco and related products, which introduces a minimum tax on:
- Vape liquids — €0.12–0.36/ml depending on strength;
- Nicotine pouches — €143/kg;
- Heated tobacco — €108/1,000 sticks or €155/kg.
Countries that already exceed these minima (such as Bulgaria for liquids) will not have to lower their rates. This means that Bulgaria’s BGN 0.66/ml in 2029 (≈ €0.34) will be “anchored” close to the upper limit of the future requirements and will certainly remain above the European average.
8. Conclusion: Balance or imbalance?
The new provisions in the Excise Duties and Tax Warehouses Act achieve the fiscal goal—more revenue and gradual convergence with the German taxation model. The health impact, however, is ambiguous:
- Cigarettes remain relatively cheap compared to the EU, reinforcing Bulgaria’s reputation as the “cheap pack” of Europe.
- Vape liquids—proven to be less harmful to smokers—are taxed at some of the highest rates in the Union, with no differentiation by content.
- The risk of an illicit market and smuggling of nicotine liquids will increase, as seen in Germany and Denmark after similar hikes.
The political challenge in 2026–2027 will be to find a balance between revenue, public health, and incentives to switch to less harmful products. The forthcoming revision of the European directive may allow for fine-tuning—for example, introducing lower rates for nicotine-free liquids or for concentrations below 10 mg/ml.
Until that happens, Bulgaria will remain the exception where a pack of cigarettes is among the cheapest in the EU, while 10 ml of nicotine-free vape flavoring is taxed more heavily than cigars with cognac.
Used sources
- DarikNews, Pariteni, Novinite — on the adopted budget and the new rates;
- WIIW & Tax Foundation Europe — on comparative rates and cigarette prices;
- Chemnovatic, Vaping360, Hangsen, EdgeVaping — on excise rates for liquids by country;
- European Commission — COM(2025)580 and other documents on the forthcoming directive;
- National media and the Ministry of Finance — on the expected revenues and the arguments in favor;
