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08/09/2006

Commission proposes increases of minimum rates

Brussels, 8 September. The European Commission has announced the adoption of a proposal to raise minimum rates of excise duties on alcohol and alcoholic beverages.

The proposal aims to restore the real value of EU minimum rates as agreed in 1992 by taking into account average EU-wide inflation from 1993 to 2005 (which is in the order of 31%).

The revalorisation foreseen by the proposal is to take effect from 1 January 2008.

In fact, the majority of Member States are unaffected by this proposal as their national rates already exceed the proposed new minimum rates. Furthermore, transitional periods up to 1 January 2010 are proposed for those Member States that may have difficulties in increasing their national rates by 1 January 2008 to meet the revalorised minima. More specifically, for those Member States that are required to increase their national rates by more than 10% but less than 20%, a transitional period to 1 January 2009 is proposed; for those Member States that are required to increase their national rates by more than 20%, a transitional period to 1 January 2010 is proposed.

Although the inflation rate is 31%, the actual impact on prices in the countries affected by the decision will be minimal, for example, for beer, the biggest required increase in national excise duty would be of the order of € 0.01 (one eurocent) on half a litre of beer, at the latest by 1 January 2010.

For more information:

European Spirits Organisation (CEPS) press release: http://www.europeanspirits.org/documents/minimum_rates_-_press_release-_final.pdf