Council Directive 2008/118/EC concerning the general arrangements for excise duty has been published in the OJEU on January, 14th 2009. This new text, whose main objective is to ensure common arrangements in relation to certain aspects of excise duty, replaces Council Directive 92/12/EEC of February, 25th 1992 on the general arrangements for products subject to excise duty and on the holding, movement and monitoring of such products. As the previous text  has been substantially amended several times, it turned to be necessary to replace it in the interests of clarity.

Since it remains necessary for the proper functioning of the internal market that the concept, and conditions for chargeability, of excise duty be the same in all Member States, it is necessary to make clear at Community level when excise goods are released for consumption and who the person liable to pay the excise duty is.

Excise goods may be subject to other indirect taxes for specific purposes. In such cases, however, and in order not to jeopardise the useful effect of Community rules relating to indirect taxes, Member States should comply with certain essential elements of those rules. In order to ensure free movement, taxation of goods other than excise goods should not give rise to formalities connected with the crossing of frontiers.

“Excise goods” affected by Directive 2008/118/EC

• Energy products and electricity covered by Directive 2003/96/EC
• Alcohol and alcoholic beverages covered by Directives 92/83/EEC and 92/84/EEC
• Manufactured tobacco covered by Directives 95/59/EC, 92/79/EEC and 92/80/EEC

Member States may levy other indirect taxes on excise goods for specific purposes, provided that those taxes comply with the Community tax rules applicable for excise duty or value added tax as far as determination of the tax base, calculation of the tax, chargeability and monitoring of the tax are concerned, but not including the provisions on exemptions.

Those taxes Member States may levy can affect products other than excise goods, as well as the supply of services, including those relating to excise goods, which cannot be characterised as turnover taxes. However, the levying of such taxes may not, in trade between Member States, give rise to formalities connected with the crossing of frontiers.

Excise goods shall be subject to excise duty at the time of:

• Their production, including, where applicable, their extraction, within the territory of the Community.
• Their importation into the territory of the Community.

The Directive lays down that excise duty will become chargeable at the time, and in the Member State, of release for consumption, should it be de departure from a duty suspension agreement, the holding of excise products outside a duty of suspension, the production of excise goods, including irregular production, outside a duty suspension arrangement; or the importation of excise goods, including irregular importation, unless the excise goods are placed, immediately upon importation, under a duty suspension arrangement.

Time and place of chargeability for excise goods

Excise duty shall become chargeable at the time, and in the Member State, of release for consumption, which as set in the Directive will mean:

• The departure of excise goods, including irregular departure, from a duty suspension arrangement.
• The holding of excise goods outside a duty suspension arrangement where excise duty has not been levied pursuant to the applicable provisions of Community law and national legislation.
• The production of excise goods, including irregular production, outside a duty suspension arrangement.
• The importation of excise goods, including irregular importation, unless the excise goods are placed, immediately upon importation, under a duty suspension arrangement.

This new Directive harmonises the rules concerning liable persons to pay the excise duties, rules for reimbursement and remission, as well as general provisions for the movement of excise goods under suspension of excise duty, documents and procedures to be fulfilled by competent authorities, and rules for the movement and taxation of excise goods after release for consumption

Each Member State will determine its rules concerning the production, processing and holding of excise goods, subject to this Directive. The production, processing and holding of excise goods, where the excise duty has not been paid, will take place in a tax warehouse.

Acquisition by private individuals of excise goods

Excise duty on excise goods acquired by a private individual for his own use, and transported from one Member State to another by him, shall be charged only in the Member State in which the excise goods are acquired.

To determine whether the excise goods are intended for the own use of a private individual, Member States shall take account at least of the following:

• The commercial status of the holder of the excise goods and his reasons for holding them.
• The place where the excise goods are located or, if appropriate, the mode of transport used.
• Any document relating to the excise goods.
• The nature of the excise goods.
• The quantity of the excise goods.

For the purposes of such rules, Member States may lay down guide levels, solely as a form of evidence. These guide levels may not be lower than:

For tobacco products:

• Cigarettes: 800 items.
• Cigarillos (cigars weighing not more than 3 g each): 400 items.
• Cigars: 200 items.
• Smoking tobacco: 1,0 kg.

For alcoholic beverages:

• Spirit drinks: 10 l.
• Intermediate products: 20 l.
• Wines: 90 l (including a maximum of 60 l of sparkling wines).
• Beers: 110 l.

It is necessary, in order to ensure the collection of taxes at the rates laid down by Member States, for the competent authorities to be in a position to follow the movements of excise goods and provision should therefore be made for a monitoring system for such goods.

Directive 2008/118/EC will enter into force on January 15th, 2009, and Member States will adopt and publish, not later than January, 1st 2010, the laws, regulations and administrative provisions necessary to comply with this Directive with effect from April, 1st  2010.