Taxes Spoil Bulgarian EU Celebrations

by Ulrika Lomas, for LawAndTax-News.com, Brussels

26 January 2007

Bulgarian celebrations after EU accession no doubt involved plenty of local 'rakia' firewater: but a new Brussels-inspired excise duty on the home-produced drink has given its distillers a mighty hangover.

The government moans that it has already negotiated the minimum possible level of the tax (on distilled alcohol) and wants to collect just 2.20 Bulgarian leva (about one euro) per litre of distilled rakia extracted for quantities of below 30 litres. But there are nation-wide 'Don't touch our rakia' protests, set to culminate on national 'wine day' February 14th with a mass meeting in front of the National Assembly.

Rakia or rakija is made all over the Balkans by distillation of fermented fruits. Alcohol content is normally 40%, but home-produced rakia can be stronger, typically 50 to 60%. The drink is sometimes called 'Skorosmrtnica' (meaning "near death").

Village communal distilleries are said to be deserted as locals revert to home-distilling in order to avoid the tax. Feelings are running very high: "Are you from customs? Because if you are, we are not telling you the way to the distillery. We are not giving up our rakia," a group of elderly women in Kraynici told an AFP reporter.

The tax is set to be debated in Parliament next week; but the government is between a rock and a hard place.

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