New VAT for nicotine-free snus
The Swedish Tax Agency has recently published a statement that tobacco- and nicotine-free snus should not be considered food. The VAT rate for tobacco- and nicotine-free snus is therefore 25 percent instead of 12 percent, according to the Swedish Tax Agency. The application took effect on 1 July 2019. This means that the prices of nicotine-free snus will increase.
On 28 May 2019, the Swedish Tax Agency published a statement that snus containing neither tobacco nor nicotine is not considered food. For these products, VAT must therefore be charged at 25 percent (and not at the reduced tax rate of twelve percent applicable to food).
The Swedish Tax Agency states that snus is a product intended to be placed under the lip and then spat out again. Nicotine-free snus products mostly contain bulking agents, plant fibers, flavorings and sweeteners, and are usually designed in the same way as the tobacco product snus with regard to the appearance of the packaging and the size of the pouches.
For a product to be considered food, the product in question must be intended to be, or reasonably expected to be, ingested by humans according to Article 2 of Regulation (EC) No 178/2002 of the European Parliament and of the Council. In its statement, the Swedish Tax Agency indicates that this should be interpreted as covering products intended to be placed in the mouth to be drunk or eaten, that is, to be swallowed. Since snus is not intended to be swallowed, it cannot therefore be considered food (even though its ingredients may in themselves constitute food).
What do you think about this decision? Should nicotine-free snus be considered food? Make your voice heard!
