Excise duty on alcohol may rise slightly

Beer lovers may soon have to start paying a cent or two more to down their favourite pint. Malta is among the EU countries which may have to raise its excise duty on beer as this is currently lower than the newly proposed minimum rate.

According to proposals by the European Commission, Malta will have to make the steepest increase out of the 25 member states - about 31.3 per cent on the present excise duty imposed on beer products. Although that may sound hefty, to the consumer it will only mean an increase of about one euro cent per half a litre of beer.

Malta will also have to raise its excise duty on fortified wines such as port and sherry by about nine euro cents per 70cl bottle. No rise is expected on other forms of alcohol including wine and spirits as Maltese taxation in this sector would already satisfy the EU minimum rates.

The revision is expected to come into effect at the beginning of 2008 although Malta will have a transitional period of two years, until 2010, to comply.

The Commission's proposal, which has still to be approved by the member states, was issued last week by taxation commissioner Laszlo Kovacs. He said the minimum rates were the cornerstone of the EU excise duty system which is necessary for the functioning of the internal market.

The last revision of minimum rates was in 1992. The Commission said that the majority of member states were unaffected by this proposal as their national rates already exceeded the proposed new minimum rates.

According to an EU directive on the approximation of the rates of excise duty on alcohol and alcoholic beverages, minimum EU rates have to be applied in all the EU member states. At the same time member states are free to set their national rates at levels they consider appropriate.