Sunday, February 12, 2006

Russians and their love of Vodka

Russians are known to have an intense love of Vodka, consuming around 9.1 liters of spirits per year. With this high demand has come illegal vodka producers. Botleg vodka kills around 40,000 Russians a year. To combat this, the Russian government passed a new law that went into effect Jan 1, in which an excise stamp must be on all strong alcoholic beverages in which a tax has been paid. Unfortunately the stamps needed to sell the spirits have just started being handed out and only so far in Moscow. As a result all of the distilleries have come to a halt, and the majority of shelves are bare. This tax also effects all imports. Russia is officially in a vodka shortage.

The lack of resources due to the government's need to 'fix' things has caused many companies to loose millions of dollars. What I am curious about is what is this going to do to the countries economy and to all of the effected businesses? Russians will still drink vodka when it is available again, but I dont think the new tax will cause people to stop drinking bootleg vodka. It seems to me that this situation will just cause even more distrust towards the government.

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