Kremlin Expected to Double Import Tariffs on Whisky, Other Spirits in Response to ‘Anti-Russian Policies’

(Photo: David Cheskin/PA via AP)

The Times reported on Thursday that Russia is expected to double import tariffs at 20% of the value of scotch whisky and other spirits. The fees are meant to shift market demand from what Russia deems are “unfriendly” countries to domestic production and international whiskies from places like China and India. The outlet reported that a minimum of €3 ($3.25) per liter will be the new fee. The tariff currently hovers around €1.4 ($1.52) to €1.5 ($1.62) a liter, marking a significant increase.

The outlet reported that Scotland still ships some whisky to Russia directly, and in 2023, £6.2 million ($7.93 million) left the country to go to Russia, doubling the amount of direct exports to the country from the previous year. Though the new tariffs might encourage consumers to purchase domestically made whiskies, it will negatively affect Russians with a taste for scotch whisky, according to the Times.

Yet, it appears The Scotch Whisky Association isn’t too concerned with the news. According to The Times, the organization expressed that direct exports to the country have decreased by 54% since Russia invaded Ukraine. The SWA said the impact of the damage caused by these new tariffs would be “limited.”

The Drinks Business reported that the Russian government made the move as a countermeasure to foreign sanctions.

“We are talking about systemic work to develop counter-sanction measures in response to anti-Russian policies. These measures will be felt by foreign companies while stimulating domestic production,” a representative told Russian media, according to The Drinks Business.

The outlet reported that Russia’s food and beverage industry experienced robust growth, and expanded as much as 15% in specific arenas.

The Grey Market — A Greater Threat to Scotch Whisky

Yet perhaps the greater threat to scotch whisky would be parallel imports or the grey market, which gives the country access to Scotch whisky brands without their consent. Through this system, Russia can sell certain brands without their consent after they are imported to a different country beforehand.

In February, Latvia’s role as a major player in supplying Russia with booze made media headlines, and in 2023 the country exported approximately $266 million in whisky to Russia. Latvia is a major hub for Russian trade, and big brands are shipped to Latvia by Western European countries before they are “re-exported” to the Kremlin. Lithuania emerged as another major player within the parallel imports system.

Through the parallel imports system, famous brands that have severed ties with the country still sit on Russian shelves — without the companies’ consent. Scotch brands like The Macallan and bourbon brands like Jim Beam have severed business ties with Russia, yet are still found at higher prices in the country.

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