Russian deputy PM backs 50% duty on ‘unfriendly’ wine

Increased tariffs on imports from countries that sanctioned Russia could give a boost to domestic producers, Dmitry Patrushev has said

Russian Deputy Prime Minister Dmitry Patrushev has supported a proposal to increase duties on wines from ‘unfriendly’ countries with the aim of boosting domestic winemaking. The term ‘unfriendly’ refers to countries that imposed unilateral trade and economic sanctions on Russia over the Ukraine conflict.

The deputy prime minister made the remarks on Thursday at the III Russian Wine Forum in Moscow.

“I agree that the 25% duty can be increased, maybe up to 30%, up to 50%, but this will allow us to form a source for directing money to the development of Russian viticulture,” Patrushev stated.

The idea of hiking import duties on ‘unfriendly’ wine to 50% was floated last month by the head of the Association of Russian Winegrowers and Winemakers. The group had previously proposed raising these duties to 200%.

In July 2023, in response to Western sanctions, the Russian government raised import duties on wine from ‘unfriendly’ countries from 12.5% to 20%. The tariff was further lifted to 25% this past August.

The Economic Development Ministry later claimed that domestic wine production and imports from friendly countries would fully meet domestic demand.

In May, Russian President Vladimir Putin instructed the government to direct at least half of the funds received from increasing duties on ‘unfriendly’ wine to the development of tourism in the country.

According to media reports, the Russian Ministry of Industry and Trade has also developed a draft law that would require 20% of all wine sold in restaurants and retail stores to be domestically produced. If passed, the changes could be introduced in March 2025.

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As part of Ukraine-related sanctions, the EU banned wine exports to Russia that exceed €300 ($323) per bottle, which led to a significant drop in deliveries. Import data shows that while in 2022 Italy and Spain were Russia’s top wine suppliers, accounting for more than half of all imports, in 2023 those countries were surpassed by Lithuania, Georgia, and Latvia.

Industry experts, however, have noted that given the level domestic wine production in the Baltic states, Lithuania and Latvia were likely reselling wine produced elsewhere in the EU to Russia.

On Wednesday, RIA Novosti, citing official data, reported that Russian wine imports from neighboring Georgia jumped to a record high in the period from January to September. In annual terms, the figure was up by 14%.