Greece’s coalition government suffered its first crack or its first beet bath, if you’d prefer so. The parliamentary group of Independent Greeks (ANEL) rejected the bill aiming to raise taxes for beer produced by small Greek breweries. The bill was under the Parliamentary Committee for Commerce, only SYRIZA lawmakers voted in favor.The issue is now off the table.
Taxing local breweries was not one of the lenders’ ‘prior actions’ but was part of the “structural reforms” contained in the OECD tool kit. The bill had triggered an outrage among local brewers who claimed that the taxation will lead to closure of the Greek companies.
The local production of beer has been a dynamic sector in the last decade, creating dozens of jobs from Crete in the South to Thrace in the North and in quite a number of Greek islands.
The new bill was supposed to raise the reduced special consumption tax rate for local independent breweries as of 1.1. 2016. Affected would be all breweries producing less than 200,000 hectoliter per year. For these breweries the special consumption tax rate is reduced at 50%.*
It is worth mentioning that the reduced tax rate for small breweries has been provided by the EU legislation as Brussels wanted to stimulate local and small production across Europe where monopolies and oligopolies rule. More than 8 out of 10 beers sold in Europe are in the hands of multinational corporations, mainly Heineken and Carlsberg.
In Greece, the market share owned by multinationals is 86%, while microbreweries have a share of just 0.35%
The bill was supposed to raise the reduced tax by 5% for the very small breweries, by 10% for the medium small and by 25% for the large small breweries.
Dimitris Politopoulos from “Vergina” brewery told news247.gr that the bill was aiming to collect 3 million euro from the small breweries only” while the big companies would remain unaffected. Alexandros Kouris from “Nissos” brewery said that the bill was tailored to serve the interests of multinationals only, to make Greek beer noncompetitive and even to extinguish the sector.”
Greek brewers claimed that the bill was neither in lenders’ demands surprise box nor in OECD’s toolkit.
Whatever are the dark forces behind the bill, fact is that taxes and taxes and taxes affect mainly the small and the medium incomes and revenues and the big shoes whistle carelessly in the air.
*I tried to find out how much is the not-reduced Special Consumption Tax for small breweries in Greece and in EU. I found out I had to go through 3-digit pages of EU legislation and at least 28 pages in Greek. I. Gave. Up.
PS End good, all good. Let’s have a Greek beer. Or two 🙂
