Alcohol, Estonia, Industry, Markets and Companies, Taxation

International Internet Magazine. Baltic States news & analytics Tuesday, 21.05.2019, 11:57

Estonian industry body calls for lowering excise duty on strong, low-alcohol beverages

BC, Tallinn, 14.11.2018.Print version
The Estonian Association of Alcohol Producers and Importers, a body bringing together sellers of wine and strong alcoholic beverages, says that the state's excise duty policy in the next four years should seek to establish tax peace and the excise duty rates for both low-alcohol beverages and strong alcohol should be lowered proportionally, informed LETA/BNS.

The association, however, does not support the proposal by the Estonian Reform Party to reinstate the excise duty levels of a year and a half ago, finding that this will not significantly influence cross-border trade.

Triin Kutberg, managing director of the association said that it was the high excise duty on strong alcoholic beverages that spurred on the cross-border trade between Estonia and Latvia and by just lowering the excise duty on low-alcohol beverages, cross-border trade would continue.

Kutberg said that by requesting tax peace, alcohol producers do not wish to obtain a privileged status, rather than just be treated equally, have a chance to plan their future and return to their normal business plan cycle.

The bill initiated by the opposition Reform Party seeks to return excise duty levels to what they were in February 2017. The Association of Alcohol Producers and Importers, however, estimates that with regard to the state budget, the somewhat higher market volume of beer products would not compensate the drop in excise duty levels.

"The Latvian alcohol policy pursues raising excise duty on alcohol in the coming two years, which will also presumably slow down cross-border trade. The association estimates that cross-border trade would be significantly inhibited if excise duty rates on all alcoholic beverages were lowered by 19%, as a result of which, the rates would be the same in Estonia and Latvia by 2020," Kutberg said.

The Estonian Association of Alcohol Producers and Importers includes 13 businesses: AS Liviko, Altia Eesti AS, Pernod Ricard Estonia OU, AS Prike, Tridens AS, MOE OU, Estonian Spirit OU, AS Remedia, Amber Distribution OU, Dunker Estonia OU, AS Avallone, AS Coca-Cola HBC Estonia and Brown-Forman Netherlands B.V.

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