Excise Duty – What is Excise Duty?

Excise Duty is a tax that’s designed to discourage the purchase of particular goods.

If you import goods from abroad, you might need to pay a few different types of taxes or duties. Find out more about different kinds of import duty.

Excise Duty is an indirect tax. This means that the end consumer isn’t responsible for paying the tax to the government, but they do cover the cost of the tax by paying more for the product.

By making products more expensive, Excise Duty is supposed to discourage the consumption or waste of goods that are deemed to be harmful to consumers' health or damaging to the environment. Typically, Excise Duty covers alcohol, tobacco, and some energy products.

Which goods are covered by Excise Duty?

In the UK, there are four main types of products that are covered by Excise Duty:

  • Alcohol: including beer, wine, cider, and spirits

  • Tobacco products: including cigarettes, cigars, rolling tobacco, and chewing tobacco

  • Gambling activities: including bingo, the National Lottery, machine games, and online games that involved the betting of money

  • Hydrocarbon fuels: including light fuels, heavy fuels, biofuels, and road fuels

In the UK, Excise Duty is currently aligned with the European Union. This has not been changed after Brexit, but the UK can now change these regulations as they please.

Excise Duty and importing

When you import goods to the UK, you may need to pay a number of different taxes and duties, including Excise Duty. If you buy taxable products from abroad, Excise Duty may be charged on top of Customs Duty and VAT.

If you import certain products from outside of the UK, you’ll need to pay Excise Duty to the UK government. You pay the same rates as if you were buying products from within the UK, and the rates vary from product to product.