Russia should be hiking alcohol tax more: Deputy PM

Reuters News
Posted: Aug 02, 2012 9:31 AM
Russia should be hiking alcohol tax more: Deputy PM

MOSCOW (Reuters) - Russia should be raising excise taxes on alcohol at a faster rate than currently planned, Deputy Prime Minister Arkady Dvorkovich said on Thursday.

Russia has recently started to tighten regulation of alcohol sales to curb drinking, with measures already taken including excise tax hikes, an increase of a minimum vodka price, and a ban of advertising in all media, including Internet.

"In my personal opinion, excise taxes on all alcoholic beverages - beer and everything containing alcohol - should grow more than it is currently envisaged in the budget," Dvorkovich told reporters after a government meeting.

He added that the final decision should be discussed with all the parties involved, without providing any details.

At the beginning of 2012 Russian taxes on beer rose by 20 percent and according to a Finance Ministry plan approved late last year, they will rise by a further 25 percent in 2013 and 20 percent in 2014.

These measures have hit brewers and vodka makers which rely on emerging markets such as Russia for growth.

On Wednesday Russian President Vladimir Putin said beer taxes could be increased again to curb drinking, sending Danish brewer Carlsberg's shares down more than 5 percent.

Carlsberg earns nearly half its profits from the Russian market, making it vulnerable to Russian taxes hikes. Belgium-based AB InBev and Turkey's Anadolu Efes also have a big presence in Russia.

(Reporting by Andrey Ostroukh; writing by Maria Kiselyova; editing by James Jukwey)