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To: Madeleine Harrison who wrote (2723)	6/17/1999 1:25:00 PM
From: Bob Smith	Read Replies (2) \| Respond to of 3576

I'll take news anywhere I can get it, Madly: New Tax Flows Cash To Alcohol Regulator By Anna Shcherbakova STAFF WRITER City Hall's new program to crack down on counterfeit alcohol generated $275,000 in its first two weeks - but not a single kopeck has gone to the city budget. Instead, officials at Peterburgalkogolkontrol - the city-owned enterprise responsible for regulating the local alcohol market - have been buying scanners, notebooks, cars, mobile phones and renovating their offices, according to Peterburgalkogolkontrol General Director Alexander Golubev. Since May 15, every bottle of liquor sold in St. Petersburg with an alcohol content above 25 percent has been required to have a special holographic excise stamp. In the last two weeks of May, Peterburgalkogolkontrol sold 6.7 million such stamps to producers and wholesalers at one ruble each, Golubev said. "It is difficult to plan our revenues," Golubev said when asked at a news conference last week how much of its revenues Peterburgalkogolkontrol is supposed to contribute to the city budget. Despite the apparent lack of tight fiscal oversight, however, Golubev is optimistic that his enterprise will soon be generating up to 20 million rubles (about $810,000) in revenues every month. The city's new holographic stamps are difficult to forge and provide a very efficient way to control alcohol revenues, Golubev said, adding that neither he nor his employees have yet to encounter a single fake stamp. Golubev has, however, been approached by parties interested in buying unregistered stamps at two to three times the regular price, he said. Each stamp is registered in a special database, making it possible to know exactly when and where the alcohol was produced by the touch of a scanner. "We patrol dozens of stores to make sure all the bottles are marked," he said. But if the program was designed to rid the market of bootleggers, it has had the opposite on at least one local producer. Alexander Sabadash, director of vodka maker ABF-2 and co-owner of Liviz, the oldest vodka factory in the city, has moved his ABF-2 operations to the Leningrad Oblast town of Vse volozhsk in protest of the de facto new one ruble tax. In late May, Sabadash refused to put the stamps on his products, claiming that the price of the stamp would hurt his market share and decided to move his ABF-2 factory to the oblast. The oblast charges less for excise stamps and gives many producers special tax exemptions. One industry source, who asked not to be identified, said that the city's program will only drive producers to the regions and have only temporary success in curtailing the illegal production of liquor. "The new measures will only work for about three months, after that counterfeit stamps will appear," said the source, a manager of a local alcohol wholesale company. "During this period, companies with a close relationship to Peterburgalkogolkontrol will benefit."