The Federation of the Brewing and Soft Drinks Industry would like to issue a reminder of the risks associated with raising alcohol taxation. A tax rise would be highly likely to increase travellers’ imports of alcoholic beverages from neighbouring countries. This would reduce state tax revenues and have an unfavourable impact on employment in Finland.
In its final report, the taxation development working group proposes a rise in the alcohol tax. Finland’s alcohol tax is already the highest in the EU and its major consequence is evident in the large volume of travellers’ imports of alcoholic beverages.
“We’re part of the EU, where people and goods can move freely from one country to another, and that’s something the working group’s proposal doesn’t take into consideration. Travellers’ imports of beer, cider and long drinks currently total over 40 million litres per year. When Estonia joins the euro at the start of 2011, price comparisons and transactions will become easier – and there’s a risk that this will further increase travellers’ imports,” says Elina Ussa, Managing Director of the Federation of the Brewing and Soft Drinks Industry.
Previous alcohol tax hikes have increased travellers’ imports and shifted alcohol consumption from bars and restaurants into homes. This can be seen not only in statistics on the detrimental effects of alcohol, but also in the profitability of licensed premises and a rise in unemployment. Licensed premises now sell only 10% of all alcohol consumed, and sales of alcoholic beverages in bars and restaurants continue to fall.
“In the long term, an increase in travellers’ imports may also affect the competitiveness of the Finnish brewing industry and employment. This has happened in, for example, Sweden, where up to 30% of all the beer consumed is either imported or bought on the grey market,” says Ussa.
For more information, contact:
The Federation of the Brewing and Soft Drinks Industry
Managing Director Elina Ussa, tel. +358 (0)9 148 871 (ETL exchange), GSM +358 (0)45 269 7711
Communications Manager Outi Jalonen, tel. +358 (0)9 148 871 (ETL exchange), GSM +358 (0)50 370 8677
The Federation of the Brewing and Soft Drinks Industry promotes the interests of producers of beer, cider, long drinks, soft drinks and mineral waters in Finland. Its members are Oy Hartwall Ab, Nokian Panimo Oy, Olvi Oyj and Oy Sinebrychoff Ab. The Federation of the Brewing and Soft Drinks Industry operates in connection with the Finnish Food and Drink Industries Federation and represents Finland’s third largest industry in the food and drink branch in terms of the value of production.