On 10 April, spiritsEUROPE warmly welcomed the decision of the European Court of Justice against Hungary on the “Pálinka dossier”. In 2010, Hungary decided to exempt Pálinka from excise duty when produced by households or distilleries for personal use, up to a maximum of 50 litres a year. However, excise duties for alcohol are harmonised in Europe in order to avoid distortions of competition and under Directive 92/83/EEC Hungary is allowed to grant a 50% reduction of the normal excise rate to Pálinka - but not a full exemption. The outcome of the infringement procedure started 4 years ago by the Commission will bring Hungary - hopefully soon - back in line with its commitments under the EU Accession Treaty.
This ECJ judgment is important because it underlines that tax exemptions should in no case create discrimination. Similar exemptions, which exist here and there across Europe, are not only unfair but also create opportunities for smuggling and illegal alcohol, with potential dangerous outcomes to consumers’ health. We look forward to the Commission report, due in 2015, on the impact of these exemptions across Europe.
While thanking the Commission for its long standing support, we call on itscontinuing commitment to fight more of these discriminations that exist across Europe – for instance, the Tsipouro case in Greece.
