Voting of the plenary session of the European Parliament
During the plenary session on Tuesday, the 10th of July, the European Parliament was supposed to decide about accepting the opinion of the Economic and Monetary Committee including two important issues:
– the call to raise the minimum excise for beer, direct products and spirits by 4.5%,
– the call to analyse possibilities to introduce a code of proceedings taking into account the minimum and the maximum stakes in frames of tax competition and free good flow.
The European Parliament rejected the proposal of the Commission stipulating a rise of the minimum stakes.
In 1992, the European directive 92/84 introduced a minimum excise stake for alcoholic beverages and its intention was to unify the stakes at a later date. However, due to divergences in the height of stakes in various countries, the directive did not achieve its goal.
In 2006, taking into account the rise of inflation between 1993 and 2005, the European Commission proposed to revalue the minimum tax stakes for beer by 31%. The proposal was a consequence of a report published in May 2004 and some conclusions drawn from it by the Ecofin Board in May 2005 and the Economic and Social Committee in January 2006.
The original proposal of the Commission concerning the raise of the stake by 31% was discussed and rejected in November 2006 by the Council of Ministers, as well as by the European Parliament in May 2007. The proposal was decisively rejected by some member states because of the threat of creation of a bigger gap in the levels of product taxation.
The new proposal presented by the Parliament assumes a raise of the minimum stakes by 4.5%. The intention was that such a small raise would not meet a significant counteraction because of its minimum effects. Only Bulgaria, Latvia, Malta and Romania would have to slightly change their levels of beer taxation. However, this proposal will not per se solve the problem related to the existence of big gaps in excise stakes in various member states, especially those in the north of Europe. On the contrary, it would deepen even more the gap between beer and wine.
Primarily the aim of introducing minimum stakes was probably the improvement of functioning of the internal market. This aim has not been achieved because member states in the north of Europe applied very high stakes, going far beyond the minimum stakes. As a result, enormous international differences within the internal market appeared. The differences will not be eliminated thanks to a raise of the minimum stake by 4.5%. The Commission itself underlined several times, for instance in its report from April 2004, that international differences in excise stakes seriously perturb the functioning of the internal market.
This is why the European Parliament will consider the proposal to adapt a code of proceedings which would lead to a further unification of excise stakes. It would contain not only the minimum stakes, but also the maximum ones. The minimum and maximum stakes were primarily proposed in 1998 buy they were decisively rejected by the member states which wanted to keep the right to impose excise stakes. The Code has very little chance to be adopted because its adoption by the Board requires unanimity.
European brewing sector
• The direct and indirect employment in the brewing industry in the European Union amounts to 2.6 million jobs, which is 1.2% of the total employment in 25 member states of the European Union.
• The contribution of the brewing industry to the European economy is about 0.55% of the total GDP. The total contribution of the brewing industry to the European economy measured as an added value equals 57.5 billion Euro.
The brewing industry in Europe is composed of over 3000 small and medium breweries. This supports regional development and competitiveness of the European agriculture and makes Europe the biggest producer in the world because 5 out of 7 biggest producers come from Europe.
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