Wine importers shocked: substantial excise duty increase on wine and other alcoholic beverages

We recently wrote about the alarming tax measures proposed by Minister of Finance Sigrid Kaag. And on Budget Day, it was announced that—if the cabinet has its way—excise duty on wine and other alcoholic beverages will be increased by 16.2% next year. Wine importers are shocked.

‘We did expect an excise duty increase, but not such a substantial and unreasonable one. Wine sales have been under pressure for some time, partly due to higher costs for raw materials and transport, as well as poor harvests. In addition, more and more consumers are buying their wine across the border. Germany does not levy excise duty on wine, and with this new excise duty increase in the Netherlands, the difference will become very large indeed, effectively driving consumers across the border, where fuel and other products are also cheaper,’ says Peter van Houtert, chairman of the KVNW (Royal Association of Dutch Wine Merchants).

According to the Cabinet, the estimated additional revenue from the excise duty increase on wine, beer and spirits amounts to 153 million euros.

Excise duty in Germany?

According to the cabinet, the actual impact on cross-border effects will partly depend on the measures taken by neighboring countries. But Peter van Houtert sees things differently. ‘It is highly unlikely that Germany will introduce excise duty on wine. There are no indications of that whatsoever. It is therefore questionable whether the estimated additional revenue will be collected, and it could very well be that less excise duty will actually be raised. We have seen that before. This completely overlooks the fact that the sector has been facing all kinds of cost increases for years.’

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