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Tax Gap of Heated Tobacco Products in Lebanon
Lebanon applies an ad valorem excise tax of 30% of the retail sale price on all tobacco products, including heated tobacco and cigarettes. The tax base is the producer price or the declared imported value (cost, insurance and freight (CIF)). A specific excise tax was introduced in 2018, but it is only applied on imported products. All tobacco products are subject to an import tax levied at 5% of the CIF value and 11% of the value-added tax (VAT) of the retail sale price. There is no minimum excise tax and duty-free sales of tobacco products are not banned.
Given the high inflation and informal trade of USD, the LBP/USD exchange rate has fluctuated in recent months.
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Last updated Sept. 1, 2023