13th October, Brussels - Daniel today received a new response from the European Commission, regarding his ongoing battle to save the local cider producers tax exemption. The Commission once again stated that they are looking into this issue carefully, holding a public consultation on the tax status for those who make local cider. Earlier this year the EU Commission ordered the UK government to end its forty year tax break for small producers. It meant that producers who make 33 pints or less per day will have to pay tax duty of up to £2,700 a year.
Dan has already asked the Commission directly for its stance on this issue only to be forwarded a stock answer previously written for another MEP. Today however, Dan has received a new specific response from the European Commission, who have once again highlighted that they are now undergoing a public consultation in an attempt to resolve the issue.
"I am pleased that the Commission have reiterated they they are taking views from the public and looking into this more closely because the current rules are simply unfair. Those who sell this important local product are not getting rich from selling it and it is therefore only right that the Commission recognises this and provides the same status afforded to producers of other alcoholic drinks".
The full question and answer:
1. Why is there currently no such exemption for small cider producers?
2. Is the Commission currently considering proposing such an exemption?
3. If no such proposal is being considered, could the Commission then please explain how such an exemption could be proposed?
Answer given by Mr Moscovici on behalf of the Commission (24.9.2015)
The Commission would refer the Honourable Members to its answer to written questions
E-004189/2015, E-004429/2015, E-005839/2015, E-006246/2015 and E-009770/2015.
The Directive distinguishes between different categories of alcoholic beverages and sets out specific rules applicable to each product category. Cider (and perry) fall under the category of "fermented beverages other than wine and beer", where the common EU rules foresee a minimum rate as low as 0 (zero) euro. Nevertheless, many Member States, (including the UK) have decided to apply a positive rate of duty to this category. The only relief permitted under current EU legislation for cider (and perry) is the possibility of applying reduced rates of excise duty, provided its actual alcoholic strength by volume does not exceed 8.5 %.
There are no special rules in the Directive for small producers of "fermented beverages other than wine and beer", whereas there are reduced rates for small producers of beer and of ethyl alcohol. There is, therefore, no possibility under the current legislation to grant an exemption specifically to small producers of cider (and perry). Only an amendment to the Directive could make such an exemption lawful.
The Commission is currently conducting a study of the legislation in question and on its functioning in the existing legal framework. This will include issues such as the impact of reduced rates and exemptions. Any subsequent amendment to EU legislation would, however, have to be agreed unanimously in the Council on the basis of a Commission proposal with the appropriate accompanying impact assessment.