Alcohol monopoly, not effective yet

The ordinance regarding the enforcement of state monopoly on bulk alcohol, which came into effect at the end of last week, has not been applied yet, as patronage organisations are waiting for the Government to make several modifications today.

“The old price is still applied and the old system is still preserved,” Mircia Todea, vice-president of spirits producers association Garant, told Ziarul Financiar.

He explained that certain irregularities have appeared as to the enforcement of the ordinance, concerning the double taxation applied both to bulk and bottled alcohol, and added that this problem might be solved in today’s Government meeting.

Thus, excises applied to bulk alcohol stand at 60 euros/hectolitre, while for bottled alcohol they amount to 180 euros/hl.

As to the final price of alcoholic drinks, Todea specified that there were three variants. In the first case, if the Government does not modify the ordinance but allows the difference between the two taxes to be deducted from costs, retail price will remain unchanged.

If the Executive does not allow this deductibility, the price of liquor will increase by approximately 15%. Finally, in case the ordinance is modified and the double taxation is eliminated, consumers will buy alcoholic drinks at a 35% lower price.

The reference price for bulk alcohol was established at 2,750 lei/ Dal degree. A Dal degree is represented by one litre of alcohol having a 10-degree concentration, which means that one litre of 96-degree alcohol will be acquired by the state for a price of 26,400 lei.

Beside the problems related to excises, the issue concerning the state’s acquiring all existent quantities of alcohol from producers, as the ordinance stipulates, has not been clarified yet, patronage representatives say.