Updating with inflation the value of the excise duty for ethyl alcohol, according to the provisions of the Fiscal Code, could lead to a significant increase in the prices of spirit drinks, warns the Spirits Romania organization. According to estimates, the shelf price could increase by 20-40%, and premium drinks would be affected by an increase of around 20%.
Spirits Romania, which represents the interests of the main producers and importers of spirits in the country, points out that this update could lead to an increase in excise duty by more than 50% in 2025. The association requested the intervention of the Prime Minister and the Minister of Finance to prevent such of a drastic increase, however, until now, he has only obtained promises from the authorities, without concrete measures.
“The value of the excise duty will automatically be reflected in consumer prices. Cheap drinks, predominantly produced by Romanian companies, will be the most affected, with an estimated increase of 40%. Also, the increase in excise duties could open the way to the black market for alcoholic beverages and could lead to significant layoffs in the industry,” said Florin Rădulescu, president of Spirits Romania. According to calculations, the impact of this increase could lead to the loss of around 46,000 jobs in the sector.
Rădulescu proposed a more balanced approach, similar to the timetable for increasing excise duties on beer, which would provide better predictability for producers. Prime Minister Ciolacu recognized the need for such a model, emphasizing that a gradual increase could help stabilize the industry.
In this context, Rădulescu asked the Government to establish a unitary framework for excise duties on ethyl alcohol and beer, considering that the spirits industry faces unfair competition from the black market. He highlighted that, although spirits represent only 4% of the total alcohol consumption in Romania, they contribute 55% of the total excise taxes generated by the alcohol industry.
According to 2023 data, of the list price of a bottle of spirits, 36% is excise duty, 20% is raw material costs, and the rest covers marketing, labor, transportation and energy. In an economic context where raw material and energy prices are rising, local producers are in a delicate situation with limited options to remain competitive.
Consumption of untaxed alcohol has negative effects on the economy, including lower VAT collection and health risks for consumers. A 2018 study showed that of all alcohol consumption among adults, 60.7% was untaxed. A recent survey conducted by ivox.ro revealed that 34% of Romanians consumed alcoholic beverages from uncontrolled sources, often because of their lower prices.
Source: www.cotidianul.ro
