Italy: Beer industry hopes for better regime of taxation

The Beer and Malt Industrialists Association (AssoBira) is hoping for a sign that the policies of the previous government on the suggestion of measure to correct public finances, will be dropped, Agenzia Giornalistica Italia (AGI) communicated June 12.

The sector is hoping that the regime of taxation on beer can be adjusted to levels in line with the average in continental European countries. Since 2004, reads a statement, the Italian beer industry has already been damaged by as many as three increases in taxed that have led to an increase in tax on the product of 68pct, one of the highest tax rates in the EU.

The current level of tax is in fact at around 2/3 times above the one in force in countries that are the bog producers of beer, being Germany Spain and France. In the face of these increases in prices, caused by the increases in tax since 2004, the positive trend of sales in beer in Italy has been interrupted.

The strong contraction in sales in public outlets has reduced the VAT income for the treasury thereby frustrating general increases in tax. In the first four months of 2006 sales went down by 5pct. "Compare to the previous government - Piero Perron, President of Assobirra commented - we are hoping for a net change of tack by the ministries led by President Romano Prodi that can no longer follow a line that has failed and is counter productive. The taxation policy of the past relating to beer has not been useful in fighting the public deficit but instead has ended up damaging an area that has a high potential for growth. The economical work of the government, therefore, must bear in mind the stagnation of the sector, which contributes significantly to the national economy with a value of 275 million euros and guarantees tax for the treasury of over 2.5 billion euros (370 million in excise duties) has recently been indicated in a study by Ernst&Young in the European sector. Without thinking that the area provides work to vast machinery to over 133 thousand people and has an important presence in the Mediterranean with as many as eight production plants".

The Beer and Malt Industrialists Association has also turned to all the operators in the sector to ask them to indicate separately, in their invoices, the element relating to excise duties, in line with what takes place in the sector of alcohol sales as well as in the majority of European Countries for beer. AssoBirra maintains that the so called separation of excise duties can contribute to major transparency of factors in the cost of beer and bring to light an element generated by external decisions on which the industry has no power of influence.

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