Written Answers. - EU Directives.
Jack Wall
Ceist:
21
Mr. Wall
asked the
Minister for Finance
the manner in which he proposes to act on the finding of the EU Commission that Ireland is in breach of the excise duty directive in regard to the taxation of wine; and if he will make a statement on the matter.
[22706/99]
Minister for Finance (Mr. McCreevy): It is not correct to say that the EU Commission has issued a finding that Ireland is in breach of EU excise directives.
The position is that the EU Commission has issued a Reasoned Opinion, to Ireland, pursuant to Article 226 of the EC Treaty, concerning Directive 92/84/EEC on the approximation of the rates of excise duty on alcoholic beverages. The opinion argues that the present Irish alcohol tax regime is contrary to Article 90 of the EU treaty in that the Irish excise duty on wine is, in their view, discriminatory as a consequence of the lower excise imposed on beer.
There is no guidance in the directives as to the ratios that must be applied in the taxation of alcohol. Ireland has an excise regime linked to the alcoholic strength of the product, as defined in the directives, thus aiming at, as far as possible, a fair treatment to products of comparable strength. There is nothing in the EU Directives which prevents such a basis for determining excise duty.
We have responded to the Commission pointing out that Irish excise rates on alcohol broadly reflect alcoholic strength of products; the ratio between beer-wine is approximately 1:3, reflecting the relative alcoholic strength of beers and wine actually sold here; beer and wine are not in the sort of direct competition which the Commission maintain and are not marketed, distributed or sold in the same way; and that the EU Commission itself permits a zero rate of excise on wine in many member states which tax beer. This in itself is a distortion which the Commission has not acted on up to now.
It is up to the Commission to decide in the light of our response whether to pursue their case under legal procedures provided for in the treaty.
