Brussels, 23/11/2006 (Agence Europe) - The compromise proposal from the Finnish EU Council Presidency on increasing the rate of excise duty on alcohol and alcoholic drinks to keep up with inflation received a mixed welcome from most Member States, on Wednesday 22 November, during the Coreper meeting of Member State representatives (see EUROPE 9311). The dossier, which requires unanimity, will be on the agenda of the Ecofin Council next Tuesday.
Germany was generally in favour of the proposal by the Finnish presidency to increase excise duties on beer by 4.5% as of 2008. This rise corresponds to the rate of inflation observed since 2004 and would not have an immediate impact on this country. The Czech Republic, another country where beer production is an important sector, is said to be keeping its veto on the proposal, which would not, however, have an immediate effect on its excise rate. Member States that do not wish to differentiate the rise in excise duty for the different alcoholic beverages apparently, however, gave more support to the Commission's suggestions. In a letter to the European finance ministers, László Kovács, Taxation Commissioner, suggested that revalorisation of the excise rates should only be calculated for all products concerned as of 2004, the year of enlargement.
Several Member States hoped to examination this further before the suggestion of the Finnish Presidency to bring in, from 2011, an automatic review mechanism for excise rates so that ministers do not have to continually come back to the issue. They hope to assess the way in which this mechanism would work in practice and determine its impact on their excise rates. (mb)