Expanded Summary

Russian President Vladimir Putin signed a law under which the excise duty for wines have significantly increased from January 1, 2020. The document published on the official portal of legal information amends Part 2 of the Tax Code.

As appears from the document, the excise rate by usual wines will increase from 18 rub to 31 rub for liter in 2020, 32 rub - in the 2021st and 33 rub in the 2022nd. On sparkling wines, the rate will increase from the current 36 rubles to 40 rubles/l in 2020, 41 rubles - in 2021 and 43 rubles - in 2022. The financial and economic justification of the law states that its entry into force will ensure the receipt of additional budget revenues in the amount for about 22 billion rubles annually.

At the same time, the law refers to sub-excise goods wine materials and grapes used for wine production. Excise rates on them should be 31 rubles/l and 30 rubles/t respectively, with an increase of 1 ruble in the next two years. At the same time, wine producers from Russian grapes will be entitled to tax deductions. The excise sums estimated when using the grapes belonging to the taxpayer on the property right for production of wine, sparkling wine, wine materials, and alcoholic drinks on technology of a full cycle will be deductible.

According to the current code, Russian usual and sparkling wines with protected geographical indication and protected name of origin are subject to a preferential excise rate. The adopted changes equalize rates on Russian and imported wines, which brings Russian legislation into line with WTO rules, the Ministry of Finance said earlier. At the same time, the amendments allow to silent support Russian winemakers, as beverage producers will be able to receive tax deductions on excise when using their own grapes. As a result, the tax burden on excise for producers of wines from domestic grapes will decrease in times and import duties, for example on Georgian wine, will increase drastically.