Albania: Microbrewers calling for tax relief

From January 1, 2023, after the implementation of the changes in Albania’s law "On excise duty", local craft breweries have been paying 110% more excise duty than before for 1 litre of beer produced, CAN reported on May 27.

The excise duty accounts for 40% of the total cost for these producers.

In order to survive, small breweries, according to the President of the Albanian Microbrewers Association Xhim Begeja, have increased prices, but at the same time have reduced the amount of production due to the competition of imported beers.

In total there are 10 small breweries in Albania, such as: Puka Beer, Pan, Dyst, Grandfather Beer, Gjallica Beer, Karabash Beer, Lushnjë Beer, Saraçi Beer, Altenberg Beer and Brahause Beer, which together produce about 3,000 hl per year .

For this reason, the association of microbreweries is asking the State Ministry for Entrepreneurship and Business Climate to exempt the 10 craft producers from the obligation to pay excise duty and the obligation to perform DSHA (declaration of advance payment of excise duty for any product that leaves the factory without the goods being sold yet), or fixed fee per reduced litre and exemption from the obligation to perform DSHA.

"The calculation formula with the previous charging was 360 Lek x 4% alcohol = 1,440 Lek excise duty for 100 litres of beer or 14.4 Lek per litre. With the change in excise duty, it became 744 x4%=29.76 ALL for 100 litres of beer or 29.76 ALL per litre. The excise duty has increased by 110%.

“So our beers come out with 4.8% alcohol, because this is the production technology.

“The higher the alcohol, the higher the excise duty. For example, for 1 litre of beer produced with 5.2% alcohol x 744 excise duty = 3,869 Lek excise duty per 100 litre or 38.69 Lek per litre.

“The obligation for the excise duty accounts for 52% of the material cost or 35 to 40% of the total cost,” asserts Begeja.

The Albanian Microbreweries Association has worked out the following two options of support from the government:

Option A

Exemption from excise duty and the obligation to perform DSHA (declaration of advance payment of excise duty for any product that leaves the factory without the goods being sold yet). Support for various activities.

Option B

Fixed fee per reduced litre and exemption from the obligation to perform DSHA. Support for various activities.

The costs of the state for the support of 10 micro-businesses with high development potential are calculated on average at around 10,000,000 ALL per year.

27 May, 2024