11 April 2007 - MEPs in the Economics Committee say that minimum levels of duty for alcoholic drinks should be scrapped. Instead Member States should adopt a code of conduct that encourages them to move towards the EU average level of duty.
In 1992, the then 12 EU Member States unanimously agreed to set minimum levels for excise duties on beer, spirits and other alcoholic drinks apart from wine. The aim was to reduce the market distortions caused by widely differing excise levels. The Commission is now proposing that these minimum levels (which were set as absolute amounts, not as a percentage) should be increased in line with inflation since 1992.
The Committee, however, in a report by Astrid Lulling (EPP-ED, LU) adopted on Wednesday, argues that the minimum levels have failed to achieve the desired convergence in excise duties, and that they should therefore be scrapped. Instead, MEPs in the committee are proposing a code of conduct which would encourage Member States with duties above the EU average to freeze and gradually lower them, and those with duties below the average to consider raising them by an appropriate amount. In both cases, Member States could take into account their general economic situation - which would enable, for example, those countries hoping to meet the Maastricht criteria for joining the euro not to increase their inflation rates by quickly raising excise duties on alcohol.
The report, which was adopted with 19 vote in favour, 15 against and 2 abstentions, is now due for consideration at the Brussels plenary session of 9-10 May 2007. As is usually the case for taxation policy, Parliament's view is consultative and any decision on whether to increase, reduce or scrap the minimum levels of duty will require unanimous agreement between the Member States in the Council.