BISHKEK (Karavan.kz) — Kazakhstan worries influx of counterfeit vodka from Kyrgyzstan after increase in excise taxes.

“Seeing that the excise rate increases from the New Year, prices for domestic products will also grow, but not much. Parliament has made a decision that would be supported by the head of state, and instead of the planned 33% the excise rate will grow only by 15%”, the President of KazAlko Association Amirzhan Kaliev said.

“Any increase in the tax burden, especially during the crisis, has a negative impact on any business. The load, increase in prices and subsequently reduced competitiveness - all this, of course, will have its effect. Those kinds of alcoholic beverages, that are imported from abroad, will become more expensive due to ‘free floating’ of tenge. The cost of the imported products will increase significantly, perhaps, the rise in price will reach 30-40%”, he said.

Amirzhan Kaliev stresses that if before the goods were mainly imported from Russia, now “gray” batches can come completely from the other side.

“It can also lead to smuggling, of course. For example, if in 2014 we experienced the flow of smuggled Russian vodka resulted from the devaluation of ruble, in 2016 we can observe smuggling of Kyrgyz vodka. At present, the excise rate in Kyrgyzstan two and a half times lower than ours, and the minimum price is two times lower. So the delivery by natural persons, allegedly, for personal consumption can take place”, Amirzhan Kaliev said.