:. Food Industry News


Russia Duma Passes Beer Tax Hike in First Reading

Source: Reuters
06/11/2009

Moscow, Nov 6 - Russia's lower house of parliament has cleared the first reading of a bill to triple duties on beer, which the government hopes will help plug a budget deficit and brewers fear could lead to factory shutdowns.

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The bill was approved by a majority of 315 votes to include amendments to the tax code to increase the duty on beer to 9 roubles from the current 3 roubles.

Government officials have said the bill will bring in an extra 65 billion roubles ($2.24 billion) of budget revenues in 2010. It was not immediately clear when the Duma will hear the second reading, when most draft bills can be amended.

Danish brewer Carlsberg has said the firm could shut down some factories in Russia, while new higher duties could cost the country some 100,000 jobs.

The shares of Carlsberg, which owns Russia's largest brewer, Baltika, have regularly fallen in the past months on news from Russia alongside the shares of SabMiller and Heineken's.

Apart from higher duties, a ministry has proposed drastic limits on beer sales via kiosks and in markets which industry experts say could affect over 25 percent of sales in Russia.

The proposal, which has yet to be reviewed and approved by the government, came shortly after President Dmitry Medvedev ordered tough measures to curb alcohol abuse, describing alcoholism as a "national disaster".



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