The Russian Brewers Union has appealed to the Government to request further measures to protect small and medium-scale brewing businesses in the country.
The main threat to the sector, according to the Union, is the existing taxation regime. And a letter addressed to the Cabinet of Ministers has requested the amendment of the current taxation.
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According to the State Statistics Committee there are 310 major Russian brewers, out of which 30 are big companies with capacity over 6m decalitres. The 280 brewers left are small and medium-scale businesses. The latter, according to the Union Executive Director Vyacheslav Mamontov, are mostly exposed to the shortcomings of the federal policy in the small business sector.
A press release from the Union said: “That is why the Russian Brewers Union has requested the Government put the small and medium-scale businesses under a simplified taxation regime. Nowadays, simplified taxation procedures are applicable to businesses with annual turnover RUB15m and staff of not more than 100 employees. Mmany brewers are not entitled to the simplified taxation procedures as they fall under excise goods producers category.
The Russian Brewers Union also requested that the Cabinet of Ministers fix the excise rate for 2004-2005 at the same rate as this year. Last year the excise imposable on the most popular brands (0.5% to 8.6% alcohol) was RUB1.12 per litre. As from this year the excise has been hiked by 25%, and the brewers are arguing that, “such an excise policy implemented by the Government is a restraint for investors in the sector, and rather targets elution of turnover assets from producers”.
“The Russian Brewers Union proposes a different excise rate system to be introduced depending on business capacity and sales. The request also stipulates details: if a brewer’s capacity is over 6m decalitres (the majors) the excise should be 100%; if a brewer’s capacity is 4-6m decalitres the excise should be 75%; if a brewer’s capacity is 2-4m decalitres the excise should be 60%; 1-2 mln. decalitres – 50% and less than 1m decalitres – 40% excise accordingly.
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