HELSINKI: Alcohol producers are warning that a sharp increase of excise duty on alcohol would end the border trade between Estonia and Finland, fuel alcohol smuggling and illegal alcohol trade, reduce the number of tourists by half and bankrupt the alcohol industry.
The previous so-called spring coalition of Reform Party and Social Democrats decided to increase alcohol and tobacco excise duty by 10 and 5% until 2018.
This year alcohol excise duty should bring in 240 million euros in state coffers, in addition to 185 million euros collected from tobacco excise duty. A 5% increase would mean an additional 21 million euros, but it could remain too little to pay for the costs.
Alcohol producers claim that the faster rise of excise duties is not consistent with their legitimate expectations. However, politicians make a counterclaim that since excise duty is usually passed on to end consumers, the latter cannot have legitimate expectations that the alcohol price will remain the same.
