Analysis of beer market in China (on Russian)
Beer market of Ukraine: big three losing weightIn 2016, fast increase of excises and resulting price spike stood in the way of the beer market stabilization. Most of competition (as well as mass sorts) moved to the economy segment of the market. The biggest losses were incurred by the leading three, especially Obolon, which again experienced pressure after reallocation of Efes market share. However, one should already speak of TOP-4. Group Oasis CIS (PPB) became a strong player and competitor to transnational companies. Besides the net sales of many regional medium breweries look rather good and 16-fold cost reduction wholesale trade license for craft brewers opens up a possibility of rapid growth in 2017.
Analysis of beer market in China
China’s transition to a “new normal” reality backfired on the brewing industry unexpectedly. Stagnation and subsequent market decline resulted from dynamic social and economic changes. There has emerged a “two speed” market where the medium class significance is growing, yet the share of main beer consumers, “blue collar” is decreasing. Also the inflow of consumers is shrinking, as demographics stopped being a growth driver. Finally, beer is giving way to other alcohol drinks....
India. Karnataka orders recovery of tax dues from UBL
The exact amount of entry tax that can be recovered from UBL is still being calculated by the department, according to which the company has not paid entry tax on movement of malted barley/barley malt into its brewery on the outskirts of Bengaluru. The firm has not paid entry tax dues from 2007 to 2009, sources told FE.
Vijay Mallya as the chairman of United Breweries holds 35.8% stake in the company (as on March 31, 2015), while Dutch brewer Heineken holds 42.4%. Mallya left India early this month as banks sought a court order to confiscate his passport and arrest him for not paying their dues.
The company instead contested the department’s claim in the Karnataka Appellate Tribunal and got a relief stating that malted barley is an agricultural produce and is not liable for any tax. Subsequently, the department had moved the High Court in 2011. The divisional bench of the Karnataka High Court, in its order in September 2015, upheld the department’s claim of levying entry tax on malted barley/barley malt under the provisions of Karnataka Tax on Entry of Goods Act, 1979.
“The notification (No. FD 11 CET 2002(1) dated March 30, 2002) provides for levy of entry tax in respect of raw materials and inputs, which are used in the manufacture of tobacco products and liquor. Hence, arecanut, tobacco and any other agricultural produce brought into the local area for the manufacture of liquor and tobacco products such as beer, cigarettes, cigar, gutka, churuts, zarda and quimam pan masala or any other products which can be classified as liquor or tobacco products are liable for entry tax,” a circular issued by Commissioner of Commercial Taxes said.
In the circular issued recently, Ritvik Pandey, Commissioner of Commercial Taxes has instructed the department officials to impose 1% entry tax on raw materials brought into the local area for manufacture of liquor by the company.
Despite repeated attempts, the management of UBL was not available for a comment.
“All the assessments/re-assessments concluded by the assessing authorities allowing exemptions as agricultural or horticultural produce are to be reopened and reassessed in the light of the order of the division bench of the High Court of Karnataka under the provisions of the Act,” Pandey said in his circular.
The commissioner has also instructed the department officials to take up all the cases of the respondents (United Breweries) for the previous years wherever exemptions are allowed for reassessment on priority and levy the penalty and interest as existed at that point of time for the relevant years of assessment or reassessment.
The enforcement authorities have been directed to take immediate action to cull out information and take up inspection and conclude the proceedings as early as possible and send the reports to the concerned offices to take up assessment proceedings against the company.
“Even though barley is an agricultural produce, it is liable for levy of entry tax when used in the manufacture of liquor at the rate of 1% as per the notification issued by the government on March 30, 2002.
The department is right in ordering for the payment of tax arrears from the defaulting companies,” said B T Manohar, chairman, state taxes committee, Federation of Karnataka Chambers of Commerce and Industry (FKCCI).
24 Mar. 2016