Ministry of Economy proposes to raise minimum prices for certain types of alcoholic beverages

The Ministry of Economy of Ukraine proposes to increase the minimum wholesale and retail prices for certain types of alcoholic beverages. The relevant draft government resolution has already been put up for discussion on the ministry's website.

Representatives of the Ministry of Economy believe that the price increase is necessary due to changes in the socio-economic and tax spheres, namely rising prices for raw materials, components, energy, and labor costs. It is also due to the change in excise tax rates on alcoholic beverages, which came into force on March 1, 2022.

The government believes that the current minimum prices for alcohol do not correspond to the actual costs of business entities for the production and sale of these beverages and need to be adjusted. Therefore, it is proposed to increase prices for different types of alcoholic beverages in appropriate proportions.

In particular, it is proposed to raise prices for vodka and alcoholic beverages by 13%, for whiskey, rum and gin by 25%, for cognac (brandy) by 11-12%, for wine products (non-sparkling wines) by 62%, for cider, perry, wines, vermouths and other fermented beverages by 61-71%, and for sparkling and carbonated wine drinks by 28%.

At the same time, a coefficient of 0.85 of the approved minimum prices will be applied to wine products supplied in Tetra-Pak and Bag in box packaging. It is worth noting that this change does not apply to cider and perry without added alcohol, as well as fermented beverages obtained as a result of natural fermentation of fruit, berry and fruit and berry juices with an alcohol content of no more than 8.5% by volume.

The current minimum prices for alcohol (wholesale and retail) were set in September 2018. Only prices for sparkling wines and carbonated wine drinks were raised in January 2021.

For example, the minimum wholesale price for vodka and spirits is UAH 321 per 1 liter of 100% alcohol, and the retail price is UAH 447.

Further discussion and consideration of the draft resolution is now expected, and the decision to raise minimum alcohol prices will be made by the government based on the results of this process.