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Tax Gap of Heated Tobacco Products in Georgia

Prior to 2018, heated tobacco was not defined in the tax code and was taxed at the same rate as “pipe tobacco,” with a specific excise based on weight. 

The excise tax law was amended on Dec 28, 2017 (Law of Georgia No. 1935) to include heated tobacco and e-cigarettes in separate categories of tobacco products. Heated tobacco is defined under two categories: “capsules and similar products, with tobacco content” and “tobacco products, without burning process, to be used for obtaining aerosol,” both subject to a mixed excise system with an ad-valorem excise based on the retail price and a specific excise based on the number of sticks, and at the same rate as cigarettes. This law went into effect Jan 1, 2018. 

In late 2019, new legislation amended the tax code to increase the ad-valorem excise. Since Jan 1, 2020, cigarettes and heated tobacco sticks are subject to a mixed excise system that includes an ad-valorem excise of 30% of the retail sales price and a specific excise tax of GEL 1.7 per pack of 20 sticks.

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Last Updated Feb. 20, 2021