Kazakhstan to Raise Excise Tax on Cigarettes and Alcohol

Source from:  The Times of Central Asia (kg)  09/22/2013

The Government of Kazakhstan plans to raise the excise tax on alcohol and tobacco products next year.

"The excise tax on tobacco is currently 1,550 tenge ($10) per 1,000 cigarettes. We will raise it to 3,000 tenge ($20), that is double it, starting from 2014," said Minister of Economy and Budget Planning Yerbolat Dossayev according to his ministry's press service.

He also said that the government plans to gradually raise the excise tax on cigarettes to 45 euro ($61) per 1,000 cigarettes by 2020.

In the minister's words, the excise tax for 1 liter of spirit is currently 2.5 euro ($3.4), and it will be raised to 5 euro ($6.8) in 2014 and 8 euro ($10.1) in 2016.

Dossayev said that cigarettes and alcohol are too cheap in Kazakhstan. According to the World Health Organization, Kazakhstan is among the top 30 countries in terms of alcohol consumption which stands at 7-8 liters per capita a year.

"I am far from cherishing the illusion that everyone will quit smoking after the prices of cigarettes rise or that people will quit drinking if vodka becomes more expensive," the minister said. "But at least, I think, there will be less new smokers and alcoholics, as people will think whether they should start smoking when a pack of cigarettes costs $5-$10."

Commenting on the possible growth of illegal tobacco and alcohol production, the minister said that the shadow market of such products already exists in Kazakhstan but its control must be strengthened.

"We will tighten the rules of alcohol sale so that the spirits are only sold in large trade centers and special stores," he said. Enditem