At a time when British politicians are considering mandating a minimum price for alcohol in an attempt to stem the Nation’s drinking and taxes on cigarettes in the UK are at their highest ever, it seems alien that a government minister would publicly encourage either vice.  However, Russian Minister of Finance, Alexei Kudrin has spoken out promoting the increased consumption of both alcohol and cigarettes saying that it will help boost the Russian economy.

Mr Kudrin commented “If you smoke a pack of cigarettes that means you are giving more to help solve social problems.  People should understand: Those who drink and those who smoke are doing more to help the state."

The comments follow government plans outlined in June to more than double the excise duty on cigarettes from 250roubles, roughly £5 per 1,000 cigarettes, to 590roubles (£12.49) by 2013.

As Minister of Finance, Mr. Kudrin will have noticed that the revenues from taxes on alcohol have declined recently since the Russian government instituted a ban on night time retailing of alcohol.  As the Russian economy is suffering like most others around the world, he is obviously looking for ways to Increase tax revenues and encouraging smoking and drinking, particularly in light of the steep rise in cigarette taxes, will undoubtedly have that effect.

While Russia’s State Taxation Service (STS) may think that these tax increases are necessary, they are very likely to be extremely unpopular with the general public who not so long ago protested following a cigarette shortage in the country.  Considering the Russian people’s long standing love affair with smoking and drinking, further encouragement to consume either seems rather unnecessary.

The deleterious effects of excessive smoking and drinking on the health of the general public are well known even in Russia.  Furthermore, the night time ban on retailing of alcohol was instituted by the Russian government specifically to try and reduce alcohol related crime.  Perhaps the Minister of Finance rather than looking only at short term tax revenues should be taking a much longer term view and appreciate the much more damaging economic consequences of heavy drinking and smoking as a result of lost days through sickness, as well as increased policing costs to combat drunkenness and alcohol related crime.