Cabinet proposes major hike in minimum alcohol costs, aiming for up to 71% rise

The Ministry of Economy has proposed to increase minimum prices for alcohol, according to a draft resolution published on its website on Wednesday for discussion.

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"Taking into account the changes that have taken place in the socio-economic and tax spheres, in particular the growth of the cost component of prices (raw materials, components, energy, labor costs, etc.), as well as the change in excise tax rates from March 1, 2022 [...] the minimum prices do not correspond to the real costs of business entities for the production and sale of alcoholic beverages and need to be adjusted," the ministry explained.

According to the draft resolution, as a result of the increase, the minimum price for a 0.5 liter bottle of vodka will increase from approximately UAH 89 ($2.41) to UAH 101 ($2.71).

Under the proposed changes, minimum prices for alcohol in Ukraine would see the following increases:

• Brandy prices would rise by 11-12%, depending on classification     

• Whiskey, rum and gin would become at least 25% more expensive     

• The minimum price for sparkling wine would jump by 28%      

• Wine prices would have to increase by at least 62%        

• Ciders, perries, vermouths and other fermented beverages under 22% alcohol would see costs rise between 61% to 71%

The last time the government increased minimum alcohol prices was in 2018.