diff --git a/salt/renderers/gpg.py b/salt/renderers/gpg.py
index c006f42dab5..e861da81615 100644
--- a/salt/renderers/gpg.py
+++ b/salt/renderers/gpg.py
@@ -295,7 +295,7 @@ def _decrypt_ciphertext(cipher):
         return decrypted_data
 
 
-def _decrypt_ciphertexts(cipher, translate_newlines=False):
+def _decrypt_ciphertexts(cipher, translate_newlines=False, encoding=None):
     to_bytes = salt.utils.stringutils.to_bytes
     cipher = to_bytes(cipher)
     if translate_newlines:
@@ -314,14 +314,14 @@ def _decrypt_ciphertexts(cipher, translate_newlines=False):
         ret = cipher
 
     try:
-        ret = salt.utils.stringutils.to_unicode(ret)
+        ret = salt.utils.stringutils.to_unicode(ret, encoding=encoding)
     except UnicodeDecodeError:
         # decrypted data contains some sort of binary data - not our problem
         pass
     return ret
 
 
-def _decrypt_object(obj, translate_newlines=False):
+def _decrypt_object(obj, translate_newlines=False, encoding=None):
     '''
     Recursively try to decrypt any object. If the object is a six.string_types
     (string or unicode), and it contains a valid GPG header, decrypt it,
@@ -330,7 +330,7 @@ def _decrypt_object(obj, translate_newlines=False):
     if salt.utils.stringio.is_readable(obj):
         return _decrypt_object(obj.getvalue(), translate_newlines)
     if isinstance(obj, six.string_types):
-        return _decrypt_ciphertexts(obj, translate_newlines=translate_newlines)
+        return _decrypt_ciphertexts(obj, translate_newlines=translate_newlines, encoding=encoding)
     elif isinstance(obj, dict):
         for key, value in six.iteritems(obj):
             obj[key] = _decrypt_object(value,
@@ -355,4 +355,4 @@ def render(gpg_data, saltenv='base', sls='', argline='', **kwargs):
     log.debug('Reading GPG keys from: %s', _get_key_dir())
 
     translate_newlines = kwargs.get('translate_newlines', False)
-    return _decrypt_object(gpg_data, translate_newlines=translate_newlines)
+    return _decrypt_object(gpg_data, translate_newlines=translate_newlines, encoding=kwargs.get('encoding', None))
diff --git a/tests/unit/renderers/test_gpg.py b/tests/unit/renderers/test_gpg.py
index c02a1ba9588..9099b4262e0 100644
--- a/tests/unit/renderers/test_gpg.py
+++ b/tests/unit/renderers/test_gpg.py
@@ -143,7 +143,7 @@ class GPGTestCase(TestCase, LoaderModuleMockMixin):
         with patch('salt.renderers.gpg._get_gpg_exec', MagicMock(return_value=True)):
             with patch('salt.renderers.gpg._get_key_dir', MagicMock(return_value=key_dir)):
                 with patch('salt.renderers.gpg._decrypt_ciphertext', MagicMock(return_value=secret)):
-                    self.assertEqual(gpg.render(crypted), expected)
+                    self.assertEqual(gpg.render(crypted, encoding='utf-8'), expected)
 
     def test_render_with_translate_newlines_should_translate_newlines(self):
         key_dir = '/etc/salt/gpgkeys'
@@ -165,6 +165,6 @@ class GPGTestCase(TestCase, LoaderModuleMockMixin):
             with patch('salt.renderers.gpg._get_key_dir', MagicMock(return_value=key_dir)):
                 with patch('salt.renderers.gpg._decrypt_ciphertext', MagicMock(return_value=secret)):
                     self.assertEqual(
-                        gpg.render(crypted, translate_newlines=True),
+                        gpg.render(crypted, translate_newlines=True, encoding='utf-8'),
                         expected,
                     )