EU brewers want ‘unfair’ beer tax removed through TTIP

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European brewers last week (4 December) urged EU negotiators to put a removal of taxes on European brewers, from which their American competitors are exempt, on the table in the free-trade negotiations with the US.

In the EU, small brewers have a reduced excise tax rate. This tax rate also applies to small US brewers importing to the EU, whereas the equivalent small brewer tax relief in the US only applies to domestically-produced beer.

This puts EU brewers exporting to the US at an important disadvantage, Brigid Simmonds, chief executive of the British Beer and Pub Association, said at a conference in Brussels.

“If you are an EU small brewer, you get nothing when you go to the US,” Simmonds said, adding that she would like to see the EU put an emphasis on the issue as part of the ongoing negotiations of the Transatlantic Trade and Investment Partnership (TTIP).

“This is a very good example where industry needs to help us to make that case stronger in the discussions,” said Salvatore D’Acunto, the head of unit of the Commission's food and health care industries department.

“So we are absolutely open to take that on board, and to open the discussions with the US counterparts on this,” he added.

The EU brewing sector is responsible for two million jobs, representing 1% of all EU jobs; around 1.4 million jobs in the hospitality sector are sustained by beer, with a further 600,000 jobs being created in other interdependent sectors such as retail, farming and services.

“Beer is a driver for the European economy and a major job creator that goes far beyond breweries. For every one job in a brewery, there is one in agriculture, one in packaging and logistics, one in marketing, one in retail and 11 in the hospitality sector,” Demetrio Carceller, president of The Brewers of Europe, the representative body of the sector, said.

While there are signs of the sector returning to health, with both EU production and consumption showing slight growth over the last two years, beer market value growth still lags behind inflation while a further 4% of the jobs sustained by brewing have been lost, The Brewers of Europe said.

Negotiations between the US and the EU on the Transatlantic Trade and Investment Partnership (TTIP) started in July.

If successful, the deal would cover more than 40% of global GDP and account for large shares of world trade and foreign direct investment.  The EU-US trade relationship is already the biggest in the world. Traded goods and services are worth €2 billion.

TTIP would be the biggest bilateral trade deal ever negotiated, resulting in millions of euros of savings for companies and creating hundreds of thousands of jobs. It is claimed that average European households would gain an extra €545 annually, and that Europe's economy would be boosted by around 0.5% of GDP, if such a deal was fully implemented.

Brussels and Washington have set an ambitious goal of completing negotiations by the end of 2014.

  • Dec. 2013: Third round of EU-US TTIP negotiations
  • Jan. 2014: Stock-taking exercise with EU Commissioner Karel de Gucht and US Trade representative, Michael B. Froman

European Union

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