Alcohol, Tobacco Excise Duties to be Increased until 2019

ASTANA – A phased increase of excise duties on alcoholic beverages and tobacco products to strengthen the fiscal functions of excise duties will be introduced. This was announced by Kazakh Minister of National Economy Kuandyk Bishimbayev at the recent presentation of the draft law “On amendments and additions to some legislative acts of Kazakhstan on issues of taxation and customs administration” during a governmental meeting.

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The excise duties on alcohol and tobacco will be gradually increased by 2019.  Excise duties will grow to 85 percent on alcohol, 219 on beer and 74 percent on tobacco products.

“Tax Code set the excise duties for 2014-2016. The rates of excise duties have not been set for 2017-2019. It is proposed to introduce the rates of excise duties for 2017 with a gradual increase in 2018 and 2019. The excise duty on alcohol will account to 2,000 tenge (US$6) per one litre in 2017 and 2,550 tenge (US$7) in 2019. The growth will amount to 85 percent in 2016. The excise duty on beer and beer-based beverages will account for 39 tenge (US$0.11) for one litre in 2017 and 57 tenge (US$0.17) in 2019. The growth will amount to 219 percent in 2016,” said Bishimbayev.

It is proposed to set the excise duties on tobacco in the amount of 6,200 tenge (US$18) for 1,000 pieces in 2017 and 8,700 tenge (US$26) in 2019. The growth will increase up to 74 percent in 2016.

“It is proposed to introduce a zero rate of excise duty on ethyl alcohol to avoid double taxation and boost the competitiveness of domestic producers in exporting alcoholic beverages. The similar exemption is introduced in Russia and Belarus,” he said.