Excise duties on alcohol and cigarettes won't be raised in 2015 – Fiscal Service

Photo: Reuters

The State Fiscal Service of Ukraine has achieved the agreement with businesses to keep excise tax rates for tobacco and alcohol in 2015 unchanged.

"At a meeting with the representatives of the tobacco and alcohol industries we discussed this issue [raising excise taxes] and we have agreed that excise taxes will not be increased next year. This has not been legislated, but we are talking about this," head of the State Fiscal Service Ihor Bilous said at a briefing in Kyiv.

From the beginning of the year excise taxes on cigarettes were increased three times: from January 1 - by 11.7%, from July 1 - 25%, from September 1 - 5%. Since July 1 excise taxes on spirit, spirit distillates and alcoholic drinks have been increased by 25% - from UAH 56.42 to UAH 70.53 per liter of 100% spirit. Excise duty on beer in the country since May 1, 2014 has grown by 42.5%, to UAH 1.24/liter.

Alcohol and tobacco manufacturers appealed to the State Fiscal Service asking to establish a moratorium on raising excise taxes for 2015 as their further growth will lead to a reduction in legal production, the growth of the shadow market, and a reduction in revenues to the national budget.