For the first time in the world, a new type of tobacco product was created in Russia: papirosy. The emergence of papirosy in the Russian tobacco industry caused a sensation and a real revolution in the domestic tobacco business. The first mention of papirosy is dated April 29, 1844, in a circular of the Ministry of Finance of the Russian Empire.
In the Russian Empire there were tobacco excise stamps, or excise banderoles, issued from the middle and late 19th century, printed on a thin, long strip, used to seal a pack or package of makhorka, tobacco, papirosy, or cigarettes; it was impossible to open the banderole on the package without tearing it.
The banderole guaranteed the authenticity of the tobacco factory’s product being sold and indicated that the excise had been paid to the government, although excise taxes already existed in many countries at that time.
In 1727, free sale of tobacco was permitted, with a duty of 1 kopek per pound.
In 1749, the tobacco monopoly was reinstated.
In 1762, a system of free sale of tobacco was established and it was exempted from tax until the end of the 1830s of the following century.
In 1838, under the “Monetary Reform” (1839–1843) of E. F. Kankrin, Minister of Finance of the Russian Empire, tobacco again became subject to mandatory excise: “The preparation of tobacco, as an item относящегося к требованиям роскоши, may, without any hardship for the people, be subjected to a moderate excise.” The key words in this phrase, taken in context, are “luxury” and “moderate.”
In 1887 (on the basis of the Tobacco Statute), smoking tobacco was subject to excise: for 1 pound (0.453592 kg)
1st grade — 90 kopeks
2nd grade — 48 kopeks
3rd grade — 18 kopeks
Snuff — 48 kopeks
Makhorka — 8 kopeks
For each 100 pieces:
1st-grade cigars — 100 kopeks
2nd-grade cigars — 30 kopeks
1st-grade papirosy — 20 kopeks
2nd-grade papirosy — 9 kopeks
On November 24, 1917, No. 169. Decree of the Council of People’s Commissars “On the new excise tariff and maximum retail prices for tobacco products.”
Papirosy produced from banderolled tobacco in papirosy workshops (Digest of Laws, vol. V, Statute on Excise Duties, art. 897; as amended in 1912) are subject to banderoles costing four rubles per thousand pieces.
Signed: Chairman of the Council of People’s Commissars V. Ulyanov (Lenin).
Excise taxes in Russia (after their abolition by the Soviet authorities in 1930) were reintroduced with the start of market reforms in 1992.