spiritsNEWS September 2018

Reviews of Tax Structures – An opportunity for distillers

 

The EU spirits sector, while performing strongly in export markets, is sandwiched between the 2 giants of beer and wine in the EU market; we are not helped by EU tax rules. We therefore welcome the legislative proposal to amend one the tax directives because, with some adjustments, it might help small producers as well as providing an incentive to some manufacturers to reduce the alcoholic strength of their products. 

Help for small alcohol producers has long been a feature of the EU legislation, with small breweries in particular eligible for reduced excise tax rates. The legislative proposal argues for reduced rates also for small cider producers. Craft distillers, however, have never had reduced rate facilities in EU law. This seems anomalous given the advantages that come from helping craft and micro-producers. As the legislative proposal seeks to help small cider makers, albeit at production levels well below those enjoyed by beer, we hope that craft distillers can be treated the same. 

The current market trend towards lower-strength alcoholic beverages has been reflected in the legislative proposal through the suggested slight increase in the threshold below which reduced tax rates can be applied. At present this is limited to beer but there are other drinks that are sold at low strengths and which could also be persuaded to reduce their alcohol content. We hope therefore that the incentive for the beer sector can be widened so that it also includes low-strength spirit based products. 

STAY CONNECTED: Keep up-to-date with spiritsEUROPE’s activities via our Twitter & Newsletter
Subscribe