Beer Tax Blocked
Nov 10, 2006 - Germany will block the European Union proposal to raise tax rates on alcohol because it does not want to further burden its beer drinkers, and it has the support of several other countries.
"Germany is not against alcohol tax but Germany is against beer becoming more expensive," Deputy Minister Thomas Mirow said at a meeting of EU finance ministers in Brussels. "We have made clear that because of the sales tax raise, we have no maneuvering space." Germany already plans to boost its sales tax in January.
The Czech Republic, Latvia and Lithuania also spoke out against the higher tax.
German diplomats said it was "an emotional issue" that Germany could only support if beer was exempted. Spain, Portugal, Italy and Cyprus also want exceptions that won't raise the cost of their national drinks.
However, the European Commission so far has refused to consider that. Ministers need to vote unanimously for any changes to the tax law, and are likely to return to the issue in future months.