The 50% increase in minimum wholesale and retail prices for alcoholic beverages provided for in the draft law No. 11416d on introducing a number of amendments to the Tax Code of Ukraine will have a positive impact on the country’s alcohol market, Volodymyr Pechko, chairman of the board of the public association UkrSadVinProm, told Interfax-Ukraine.
He reminded that the minimum retail prices for wine and spirits have not been raised since 2018, and they are regulated by the Cabinet of Ministers.
“This will lead to an increase in tax revenues to the state budget and resolve the issue of counterfeit products,” assured the head of the industry association.
Mr. Pechko pointed out that there is currently very cheap wine on store shelves that is of extremely poor quality.
“Such a product sometimes costs 40-45 UAH/l. And compare this price with juices, which are much more expensive – this is basically impossible. In order to sell cheaply, unfortunate producers are forced to mix something into their product or dilute wine with water. Accordingly, the decision proposed by the parliament will “knock out” unscrupulous producers from the market,” explained the head of Ukrsadvynprom.
Pechko confirmed that as a result of such actions by the parliament, wine will become more expensive for the end consumer, noting that this process in relation to alcoholic beverages in the country has been going on for a long time. He explained the rise in prices for wine and vodka products by the rise in gas prices, which led to higher prices for glass containers.
In addition, crop protection products have risen in price in the 2024 season, and the price of grapes is breaking records, having almost doubled. “If wine hasn’t risen in price at the same time, it should raise questions and concern consumers. A 50% increase in the minimum retail price for alcoholic beverages is a very modest price increase. Currently, the minimum retail price subject to excise tax is 42 UAH/l, while it should be at least 95 UAH/l,” Pechko said.
The head of Ukrsadvynprom advised consumers to choose wine at a price of at least UAH 130, 150, 200 per bottle in order not to risk their health and to be sure of the quality of the product they buy.
As reported, the Verkhovna Rada adopted the law (No. 11416d) on amendments to the Tax Code regarding the peculiarities of taxation under martial law, which provides for an increase in the military tax from 1.5% to 5% starting October 1, and a 50% increase in the bank profit tax in 2024. Other new provisions include the introduction of advance payments on gas station profits, pegging the advance payment rate for currency exchange offices to the euro, increasing the minimum tax liability for agricultural land and increasing the rent for crushed stone extraction, but at the same time exempting from taxation the funds received by citizens under the national cashback program.
