Presentation of electronic excise tax stamps

22.11.2013
On 21 November 2013, a presentation of the project on the electronic excise tax stamps was held at the Ministry of Revenue and Charges. The meeting was attended by all the major manufacturers; From Imperial Tobacco took part Oliver Kutz, CEO, and Oleg Strekal, Corporate Affairs Director.

The solution presented is the Codentify technology, which combines the possibility of simultaneous control over the volumes of manufacture and sale of tobacco products, monitoring of the completeness of the excise tax charge and payment, verification of the product authenticity and monitoring of its circulation.

The essence of the technology is that in the course of manufacturing a unique encryption is applied on the packs of cigarettes; this encryption consists of twelve codified letters and numerals that are generated in a random way from almost infinite number of combinations (the number of combinations is 2,386,420,700,000,000,000).

The presentation of the pilot project of the automated system for the control over the manufacture and circulation of tobacco products using the Codentify technology for the Ministry of Revenue and Charges 

The information encoded in each encryption allows the state to control the volumes of tobacco products manufacture and the completeness of the calculation and payment of the excise tax (name of the product, date, time and place of its manufacturing, production line, maximum retail price, amount of the excise tax charged, etc.). Since the Codentify codes are unique, generated directly in the course of manufacturing and are not stored in the database system, they cannot be stolen or calculated in advance.

During the presentation, an on-line demonstration of the Codentify system operation took place at our factory in Kyiv. The system has already been implemented at Imperial tobacco on production line No. 39 and the electronic codes are applied on all the Style cigarettes.

The manufacturers suggested introducing the transition period for the implementation of this system. Before the end of this year, the necessary legislative changes should be developed and submitted to the Ministry, and by April 2014, such amendments should be adopted in order to enable the four companies to implement the project completely as of July. The whole sector, i.e. the remaining 2 per cent of the manufacturers, could switch to the new technology starting from 2015 onwards. During this year, marking with the electronic and paper stamps could be done simultaneously, and from 1 January 2016 it would be possible to abandon the paper version completely.