The beer market could fall by up to 30% in 2016 if the excise duties are increased by two times, Denys Khrenov, acting Director General of SUN InBev Ukraine, one of the largest breweries in Ukraine, has said.

"Despite the last year increase by 42.5%, the excise duty collected in January-September 2015 fell by UAH 62 million (3.2%) year-over-year. What does it mean? The goal to replenish the budget has not been achieved," he told Interfax-Ukraine on Thursday.

He said that in January-November 2015 the sector companies produced 20% less beer from a year ago.

"Maybe, first revenue from the excise duty will be larger, but even in the medium term outlook, the effect would gradually decrease, until it results in the fall in sales. As for other payments, VAT, profit tax, income tax and other taxes, they will fall not only at breweries, but also throughout the whole chain – from farmers to the retail chain, eating the whole positive from excise duty revenue," Khrenov said.

Carlsberg Ukraine is also alarmed with the draft tax reform in part of the sharp increase of the excise duties by 100% from January 1, 2016.

"In the past six year – from 2008 to 2014 – beer production fell by 28%, and this year the downward pace grew, being almost 25% in H1 2015 year-over-year," the company said.

Carlsberg Ukraine believes that beer producers would have to close production facilities, dismiss employees and tax payments to the national budget would fall.

According to tentative data from Obolon Corporation, total beer production would fall by 15% in 2015, hitting a record of around 200 million decaliters.

"The Cabinet does not want to hear these arguments: this year our facilities were loaded by less than 40% and in the peak months the loading did not exceed 50%, and in the off-season it is less than one third," the press service of Obolon said.

The company said that the government traditionally violates the requirement of Ukrainian law to ban the change of the tax rates less than six month before the start of the new fiscal year.