Latvian Saeima’s committee refuses to reduce excise tax for beer

On Thursday, 27 June, Saeima’s Budget and Finance Committee decided to not support the proposal to reduce excise tax for beer.

With the expected reduction of excise tax for strong alcohol, the proposal to reduce excise tax for beer was submitted separately by three sides – Latvia’s Agriculture Minister Kaspars Gerhards, Saeima deputy Armands Krauze and non-party deputies Aldis Gobzems, Didzis Šmits, Jūlija Stepaņenko, Linda Liepiņa and Karina Sprūde.

Politicians proposed reducing the existing minimal rate per 100 litres for beer from EUR 14.9 to EUR 12.5. The rate for alcohol concentration was proposed to be reduced from EUR 8.1 to EUR 6.8.
During the meeting, committee’s chairman Mārtiņš Bondars and Finance Ministry’s representatives mentioned that even after Estonia’s decision to reduce excise tax on alcohol, Latvia’s excise tax rate on beer remains lower than the one in the neighbouring country.

The Saeima will also soon decide on this proposal. Other than this proposal the committee continued discussing other proposals submitted for review during the 27 June meeting. On 21 June, Saeima supported in the first reading amendments to the law on excise tax, reducing the existing excise tax rate on strong alcohol by 15%.

Changes are associated with Estonia’s adopted law, which provides for reducing excise tax on certain alcoholic drinks (beer, cider and strong drinks) by 25% starting with 1 July 2019.

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