Carlsberg Critical of Bill to Raise Excise Duty on Beer in Russia

The bill will now be discussed in the State Duma and later in the Council of Federation before it can be referred to President Dmitry Medvedev for final approval and signing. This process can take several weeks.

05 Oct 2009 --- The Russian Government has just moved to the State Duma a bill to increase excise duty on beer from next year by 200%. The bill also includes an increase in 2011 and 2012 by 11% and 20% respectively.

The bill will now be discussed in the State Duma and later in the Council of Federation before it can be referred to President Dmitry Medvedev for final approval and signing. This process can take several weeks.

Until the State Duma and Council of Federation finalise their discussions and vote on the bill, it is still a draft only. Thus Carlsberg will continue to argue for a more balanced increase of excise duty on beer and strong alcohol and encourage the involved politicians in Russia to pay attention to the arguments and the rationale behind these.

Commenting on the bill , Anton Artemiev, Senior Vice President for Eastern Europe and CEO of Baltika, said: "If implemented, I firmly believe that this bill  will not only affect the brewing sector negatively. It will also have negative consequences for the Russian economy, and employment as well as for the foreign investment climate in Russia. I find it very hard to understand the logic behind the disproportionate increase of excise duty on beer (+200%) compared to strong alcohol (+10%) which will inevitably favour the consumption of hard alcohol, including vodka,  and is bound to have a negative effect on alcohol abuse in the Russian society. In particular because vodka/strong alcohol already accounts for close to 70% of total alcohol consumption in Russia compared to 20-30% in most EU-markets."