Keyword: «demand elasticity»

The text examines excise taxes as a form of indirect taxation, their role in setting minimum prices, and their impact on the consumption of socially harmful goods. It analyzes different approaches to applying excises (specific, ad valorem, combined), how market supply and demand respond, and the factors that can prevent excises from establishing a “price floor” (such as illegal trade, cross-border transactions, and producers’ economic disadvantages). The conclusion emphasizes that excises can serve as a minimum price barrier only under certain conditions, including stringent governmental oversight, the absence of an illicit market, and rational behavior from market participants.