Vodka prices may rise 5-fold in Kazakhstan by 202020 june 2013, 12:44
Vodka prices may rise 5-fold in Kazakhstan by 2020, President of KAZALCO Association Amirzhan Kaliyev told Tengrinews.kz.
According to him, the protocol of Eurasian Economic Commission dated June 5, 2012 provides for an equal level of excise tax in the Customs Union (CU) member-countries by 2020. This means that the cheapest legal vodka may cost 1,500-1,600 ($10-11) per 0.5 liters versus the current 320 tenge ($2) in Kazakhstan. "The minimum retail price will grow almost 5-fold. This will be a gigantic growth with an extreme breakaway from the real life," Kaliyev said.
Producers of alcohol goods are not happy about the perspective, he said. "In our view, harmonization of the excise rates has to be performed with consideration of our people's incomes. The excise raising policies should be adjusted to the raise of the people's salaries and the cost of living," Kaliyev said.
One of the drawbacks of the excise raising, according to Kaliyev, is that drinking people will no longer be able to afford legal vodka and will start buying cheaper counterfeit alcohol of doubtful quality.
President of KAZALCO Association Amirzhan Kaliyev. Photo courtesy of megapolis.kz
Speaking of alcohol abuse among Kazakhstan residents, the representative of KAZALCO said that a majority of the residents were consuming less alcohol every year without any legal restrictions, prices raise or introduction of any additional limitations. "We don't see much positive result from the excessive excises raise in Russia, on the contrary, many problems have appeared. A high level of "shade" production, consumption of spirit-containing technical liquids and mass production of home-brews in the regions. This shows that there is no real need to harmonize the excise taxes and bring Kazakhstan tax to the Russian level repeating their mistakes," Kaliyev explained.
However, Kazakhstan lawmakers share a completely different statistics of alcohol consumption and abuse in the country. In 2011 Senator Murat Mukhamedov said that the number of alcoholics had grown 10-fold in Kazakhstan over the previous 10 years. According to him, 33.3 percent of the population consumed alcohol. Almost 60 percent of them were teenagers and young people aged under 20. "According to the World Health Organization if the consumed spirit does not exceed 8 liters per year per capita, it does not effect the nation's genetics. We have 12 liters per capita. This shows that we are our nation is devolving and giving way to destruction," Mukhamedov said. The senator saw the main cause of the problem in low prices for alcohol and its accessibility.
Nevertheless, Amirzhan Kaliyev, trying to prove that alcohol consumption was decreasing, spoke of closure of two distilleries and one spirit factory in 2012. According to him, the number of alcohol-producing companies had halved over the previous 7 years.
Earlier deputy Finance Minister of Russia Sergey Shatalov suggested to harmonize excise rates on strong alcohol and cigarettes in the Customs Union. He explained the suggestion with the flow of alcohol goods from other CU countries to Russia.
By Vladimir Prokopenko