Excise: A Missed Opportunity

A major influencer of the price of beer is taxation. Excise, the alcohol specific tax element, is levied within a framework defined at EU level. The current framework was set in 1992 and is now being evaluated for revision. Another potential overhaul of rules like this might not come for decades, however, this opportunity to say how the system could improve for small beer producers seems to have been missed.

 

This is not the first post in this regard, and progress on this revision has been expected for a long time. A consultation of stakeholders ended in November, and the evaluation report covering this consultation was published at the end of July.

Altogether, the Commission received only approximately 700 responses. These responses came  from the tax and health authorities of the EU countries, the economic operators or their representatives and from the public. Although there are some 7,000 breweries in the EU, only 122 beer producers responded to the survey – half of them employ more than 250 people. The representation of the interest of the rest was left to the 25 industry associations linked to the beer industry that filled out the Commission’s questionnaire.

As for the UK, six alcohol trade associations and 20 beer producers took part in the consultation. Furthermore, 36 UK submissions were made by the public – the category assigned for anybody from the beer supply chain who is not a producer.

As there was so little  input from small beer producers, it is not surprising that the report recommends maintaining the current system for excise reliefs for small beer producers. This can also be seen as a lucky outcome in face of calls by those campaigners who would like to see such discounts eliminated.

A consultation like this is an occasion to reach out to policy makers both nationally and at EU level. The opening of a formal channel such as this consultation not only prompts formal responses but also presents an opportunity to submit views which standard questionnaires do not deal with or which cannot be transmitted through an online form. This is something that only two UK organisations understood: major credit is due to CAMRA for their detailed submission, the only one to counterbalance the only other written contribution by the British Medical Association. In the future, far more direct stakeholders need to be informed, mobilised and engaged.

While one might believe that this criticism is unnecessary seeing the result of the EU referendum, it is important to underline that, at the time of the consultation, it was unknown how the UK would relate to the EU in the future. In addition, the UK’s exit from the EU is unlikely to cause the disappearance of everything with EU origins or complete independence of EU legislation; EU best practices are likely to be either imposed in the negotiations or used as benchmark by policy makers.

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http://beermeansbusiness.com/2016/08/02/excise-a-missed-opportunity/
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