Government opening doors to illegal alcohol importation – lobby group

The Sense Group (TSG), a lobby group of producers and importers of the alcohol industry, stated in reaction to the 2011 Budget’s tax hikes on beer and spirits that government “should have consulted with interested parties before resorting to increase excise duty.”

“The reduction in excise on spirits in 2010 has been instrumental in a reduction in grey imports from Sicily, and it does not make sense that government has opted to reverse this decision only one year after it was implemented, opening the doors again for illegal importation of alcohol,” the TSG said.

It pointed out how this will place local producers and importers “at a serious disadvantage vis-à-vis these traders and will threaten the financial performance as well as jobs in this sector.”

TSG maintained that increasing the price of any alcoholic products is “counterproductive, as it will not address issues of abuse or alcohol related problems. Rather, it penalises the average consumer who consumes these products responsibly and without threatening his or anybody’s health.”

Also, the TSG found it strange that “whilst increases in the Excise Duty on other products were quoted by the Minister in percentage terms, the increase in the case of beer was quoted in absolute terms.”

The group speculated that “this is perhaps because the Minister found it hard to justify that the increase in excise duty on beer amounts to a 100% increase.”

The TSG concluded that the increase in excise in beer and spirits is “a desperate measure which is a blow to a number of legitimate businesses in Malta, which has been enacted without any form of consultation.”

The TSG also said that “there is no scientific proof that drinking beer or spirits in moderation is harmful to health and the excuse brought forward by the Minister that revenue from this measure will go towards the strengthening of the health sector is to say the least a very lame one.”

“If one of the main aims of the budget is to protect jobs, this does not augur well for job creation in this sector,” the TSG said.