In connection with the amendments and additions made since 01.01.2022 to the Code of the Republic of Kazakhstan "On Taxes and other mandatory payments to the Budget" (Tax Code) on taxation of excisable goods, we explain the following.
Amendments have been made to subparagraph 17) of paragraph 1 of Article 142, to articles 172 and 394, to paragraph 2 of Article 464, paragraph 6 of Article 465, paragraphs 1, 2 and 3 of Article 469, paragraph 2 of Article 480 of the Tax Code.
These amendments to the Tax Code were made in connection with the introduction of digital labeling on tobacco products from October 1, 2020, in connection with which the term "excise stamps" was replaced by the term "means of identification" throughout the entire edition of the Tax Code.
According to subparagraph 31) of Article 1 of the Law of the Republic of Kazakhstan "On Regulation of Trade Activities", the means of identification is a unique sequence of characters in machine-readable form, presented in the form of a bar code, or recorded on a radio frequency label, or presented using another means (technology) of automatic identification.
Amendments and additions have been made to Articles 172 and 394, 463, paragraphs 1 and 2 of Article 467, paragraph 4 of Article 475, paragraph 4 of Article 554 of the Tax Code.
These amendments and additions were made in order to bring into compliance with the Technical Regulations of the Eurasian Economic Union "On the Safety of Alcoholic Beverages" (EAEU TR 047/2018).
Amendments and additions have been made to Article 172, paragraph 4 and 4-1 of Article 475 of the Tax Code, providing for two ways of paying excise duty for producers of alcoholic beverages - before receiving accounting and control stamps (UKM) or on the day of its shipment, when submitting an obligation on the intended use of UKM in accordance with Article 172 of the Tax Code (effective from April 1, 2022).
In accordance with Group 22 of the Unified Customs Tariff of the Eurasian Economic Union, approved by the Decision of the Eurasian Economic Commission No. 80 dated September 14, 2021 "On Approval of the Unified Commodity Nomenclature of Foreign Economic Activity of the Eurasian Economic Union and the Unified Customs Tariff of the Eurasian Economic Union", the EAEU HS code 2205 includes the name of the item "Vermouth and grape natural wines other with the addition of vegetable or aromatic substances", and the EAEU HS code 2206 00 – "Other fermented beverages (for example, cider, pear cider, honey drink, sake); mixtures of fermented beverages and mixtures of fermented beverages and soft drinks, not elsewhere specified or included."
In accordance with paragraph 5 of Article 5 of the Law of the Republic of Kazakhstan "On State regulation of the production and turnover of ethyl alcohol and alcoholic beverages" (hereinafter – the Law), wine is alcoholic products that are made from wine in bulk (wine materials), with a volume fraction of ethyl alcohol of no more than twenty-two percent.
At the same time, paragraph 4 of Article 5 of the Law establishes that wine in bulk (wine material) is alcoholic products with a volume fraction of ethyl alcohol of no more than twenty-two and a half percent, obtained as a result of alcoholic fermentation of grapes, grape must or fruit or berry juice without the addition of aromatic and flavoring additives, without the addition or with the addition of ethyl alcohol produced from food raw materials, and (or) distillates, which is used as raw materials for the production of wine and alcoholic beverages, ethyl alcohol, obtained by direct or double distillation.
According to line 7 of paragraph 4 of Article 463 of the Tax Code, the excise tax rate (according to the EAEU HS code of 2205, 2206 00 and 2208) for alcoholic beverages (except cognac, brandy, wines, wine in bulk, brewing products) is determined in the amount of 2550 tenge / liter of 100% alcohol.
At the same time, according to line 9 of paragraph 4 of Article 463 of the Tax Code, the excise tax rate for wine (according to the EAEU HS code of 2204) is determined in the amount of 35 tenge/ liter.
In this case, the wine may be alcoholic beverages with a volume fraction of ethyl alcohol of no more than twenty-two and a half percent, obtained as a result of alcoholic fermentation of grapes, grape must or fruit or berry juice without the addition of aromatic and flavoring additives.
Based on the above, at the rate of 2550 tenge /liter of 100% alcohol, only vermouth and other wines with the addition of vegetable or aromatic substances, as well as other fermented beverages (cider, pear cider, honey drink, sake) are taxed; mixtures of fermented beverages and mixtures of fermented beverages, and natural wines, including fruit are taxed at the rate of 35 tenge / liter.