Spirits consumption in the Czech Republic is on the decline, with a shift from traditional Czech rum, “tuzemák,” to mixed drinks.
Stock Plzeň-Božkov, the country’s largest distiller, points to different tax rates for various types of alcohol as a factor hurting the domestic spirits industry. According to data from the Union of Spirits Manufacturers and Importers, sales of hard alcohol dropped by more than 50 percent in the first half of this year. This was reported by Rafal Walendzik, CEO of Stock Plzeň-Božkov.
From January to November, only whisky, aperitifs, and pre-packaged mixed drinks experienced growth, with sales increasing by nearly 60 percent. Meanwhile, “tuzemák” saw the largest decline, down nearly 10 percent. Despite this drop, “tuzemák” remains the second most popular spirit in the Czech Republic, after vodka, which saw a slight decrease in sales of 0.8 percent. Gin, a previously growing category, also experienced a decline, with a 6.6 percent drop in year-on-year sales. Walendzik attributed the shift in consumer behavior to an increased preference for ready-to-drink beverages like pre-mixed gin and tonic, whisky and cola, or mojitos. “The trend of consumers moving to categories that are taxed at minimal or no excise duty continues,” Walendzik said.
The global decline in spirits consumption has been exacerbated in the Czech Republic by a ten percent hike in excise taxes on alcohol. However, this increase does not apply to still wine, which Walendzik argues disadvantages the spirits industry. “The protectionist approach in excise duties harms our entire industry. State representatives are sending a clear signal to Czech consumers through different tax rates that they believe wine is less harmful than other types of alcohol, which is not true,” said Walendzik.
He called for changes in taxation policies to benefit the state budget and support the spirits industry, which contributes the most to alcohol-related state revenues. “Otherwise, such a policy is not sustainable in the long term, and there is a real risk that Czech consumers’ interest in spirits will shift to other neighboring markets,” Walendzik added.
