Germany weighs broader alcopop levy as sparkling-wine tax increase recedes
Germany’s governing coalition is discussing a substantial increase and expansion of the alcopop tax to mixed alcoholic drinks containing up to 15% alcohol, while an earlier proposal to raise the tax on sparkling wine and Champagne by 20% is no longer the preferred option. No final government agreement has been reached.
A wider tax under discussion
RedaktionsNetzwerk Deutschland reported on November 7 that the conservative Union bloc, comprising the CDU and CSU, wants Germany’s existing alcopop duty to cover a broader range of mixed alcoholic beverages. The plan being considered would apply to drinks containing up to 15% alcohol and would replace an earlier proposal for a 20% increase in the tax on sparkling wine and Champagne.1
The current alcopop levy is €0.80 per litre of pure alcohol, according to RND. The Union is seeking a substantial increase, but the prospective rate and its effective date have not been determined.1
Public-health case and criticism
Supporters present the measure chiefly as a public-health intervention. They argue that sweet-tasting alcopops can conceal the flavour of alcohol, appeal particularly to teenagers and young adults, and serve as an introduction to drinking. Higher prices, they contend, could reduce consumption among younger people.1
Advocates also say a higher levy could generate additional funding for prevention programs. Critics warn, however, that costlier alcopops might lead some consumers to switch to cheaper alcoholic products that are more difficult to monitor or regulate.1
Consequences and unresolved terms
Extending the tax to mixed drinks with alcohol levels of up to 15% could affect pricing throughout the ready-to-drink market and compress producer and retailer margins where the additional cost cannot be passed fully to customers. Conversely, abandoning a separate 20% increase for sparkling wine would spare that category an additional burden for now.1
The measure remains part of negotiations within Germany’s black-red coalition of conservatives and Social Democrats. The government has yet to agree on the products covered, the new duty rate or whether the change would be introduced independently or within a wider tax package, leaving drinks producers, distributors and retailers uncertain about future pricing and market positioning.1
Sources
Written by the Dionysus editors from the sources above.
