Excise tax on vodka raises prices, encourages smuggling, complain distillers

Spirits-producers are enraged about the continuing increases in excise taxes. Jozef Kapela, head of the National Council for Sprit Processing (KRPS),said, "We told the Finance Minister that if he doesn't increase the excise tax next year, we will pay the state budget the sum he has designated for it." According to the directors of spirits-producers Polmos, state budget income is decreasing despite the fact that the excise duty is continually increasing. "Every time the excise duty is increased we are forced to raise the price of vodka. As a result, the difference between our prices and those of our neighbors becomes larger and larger, and thus smuggling becomes more profitable," said Krzysztof Wrobelski, head of Polmos Lublin. The average price a half-liter of domestic vodka in Poland is zl. 20, compared with zl. 10.40 per half-liter in Russia. According to Polmos, one in three liters of spirits sold in Poland comes from an illegal source. (Zycie, p.8)