Russia’s government intends to hike excise duties on alcohol and tobacco, Vedomosti reported with reference to a source with the RF Finance Ministry and players of the alcohol market.The government suggests hiking the alcohol excise by 10 percent on year to 190.8 rubles in 2009 and 209 rubles in 2010. The current Tax Code spells out the annual increase of 6.5 percent in 2009, from 173.5 rubles per a liter to 185 rubles per a liter.

The excise duty on tobacco is forecasted to soar 22 percent to 25 percent on year. The distilleries don’t welcome these changes, reasoning that the increase will hit legal producers of alcohol.

It emerged in February of 2008 that the Federal Tax Service elaborated the Concept for the State Control over Alcohol Industry, proposing to trim the alcohol excise from 173.5 rubles per a liter to 100 rubles per a liter.

The distilleries paid to budget 80 billion rubles in excise duties past year, and the alcohol importers contributed 10 billion rubles.

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