Ukraine's government proposes 11% rise in minimum prices of vodka

"A draft Cabinet resolution on an increase in minimum prices of some types of alcohol has been posted on the ministry's website and will be available for further discussion for a month," the ministry said, Channel 112 Ukraine reported.

The ministry said it had come up with the proposal for a new increase in the prices after requests submitted by some producers who fear that legal alcohol producers' competitiveness may somewhat weaken amid economic risks from a recent increase in excise taxes.

The minimum prices of alcohol were last set in November 2016, while the excise rates were raised this year already.Read alsoPrice of ethyl alcohol in Ukraine 10.6% up in Jan, further 8% rise expected in March

"Thus, the Ministry for Economic Development and Trade has received many requests from market players, who claimed that the existing minimum prices did not cover their operating costs. This, the associations of alcohol producers claim, weakens legal producers' competitive positions while the share of counterfeit products has been growing. This happens because aiming to reduce their operating expenses, such producers buy unaccounted alcohol, use substitute materials, avoid paying taxes, and produce counterfeit goods and the like," the ministry said.

The ministry proposes the following increase in the minimum prices of alcohol in retail trade: vodka and hard liquors by 7.64-11.3%; whiskey, rum and gin by 3.5-4.6%; cognac (brandy) by 3.4-6.1%; wine containing ethyl alcohol, as well as sparkling wine and vermouth by 1.7-1.8%.