Alcohol, Estonia, Financial Services, Latvia, Legislation, Markets and Companies

Estonia's biggest vodka producer Liviko yesterday announced that it is planning, due to the planned extraordinary increase in excise duties on alcohol, to take 10-15 million euros of tax money out of Estonia, directing more business through Latvia.

"Excise is still paid in the country where the products are marketed and mostly also consumed. For [alcohol] excise tax collection to stop in Estonia, the people of neighbouring state should drink all our vodka for us," Rõivas said at the government press conference. "I doubt that will happen now. Unfortunately, there is quite a lot of this consumption also in Estonia. "

Rõivas pointed out that the standard of living and excise tax rates in Latvia tend to follow Estonia's with a few years gap, i.e. they reach the same level a little later than us. "Knowing the Latvian budgetary choices, I predict that, just like in Estonia, alcohol excise tax will rather increase in Latvia," added the Prime Minister.