Court ruling on Tobacco and Alcohol sales in Europe. Court rules Europe's 'booze cruises' may continue
LUXEMBOURG:
European "booze cruises" were saved Thursday by a ruling of the
European Union's highest court, but consumers in high-duty countries
like Britain and Sweden had their hopes of buying less-expensive
alcohol on the Internet dashed.
The
judgment came as a relief in nine EU countries with high excise duties,
which had feared a potential loss of revenue from the test case brought
by a Dutch wine lover.
The
lead plaintiff, B.F. Joustra, challenged a Dutch decision to charge him
duties on a consignment of wine he ordered a transport company to ship
from France to the Netherlands.
In
court documents, he explained that he and some 70 other food and wine
enthusiasts decided to import the wine themselves after they fell in
love with it on a trip to vineyards in France. The group had no car and
no space to take it home with them.
But
a customs charge of €906, or $1,173, on wine bottles led him to
initiate a case that climbed through the Dutch courts until they sought
advice on what to do from the EU's ultimate legal authority, the
European Court of Justice.
The
high court ruled that Europeans could import wine for themselves or
anyone else, as long as they transported it back personally.
The
judges said, however, that their interpretation of the EU's excise tax
rules meant that if people imported alcohol and tobacco through
transport companies, a national excise duty would be charged, but that
the duty in the country where the shipment originated should be
subtracted from the cost.
The
ruling - which upholds a 1992 EU law that duty is charged in the EU
state where goods are bought for personal use - means Britons, Danes,
Swedes and Finns can continue sailing or driving to neighboring
countries with less-expensive alcohol to benefit from the lower duty on
personal imports.
Alcohol is taxed at different rates across Europe, giving incentives to consumers in these high-tax countries to travel abroad to buy wine and beer.
The
court's stance is a blow for Internet companies and other cross-border
importers, which had hoped to start selling cut-price alcohol and
cigarettes across the EU.
Britain,
whose government hoped to collect £16 billion, or $30.7 billion, in
taxes from local tobacco and alcohol sales this financial year,
welcomed the ruling.
But
the European Commission, which regulates EU cross-border tax affairs,
said the court "gave a rather restrictive interpretation" of when
duties on transported alcohol or cigarettes might be imposed, a
commission spokeswoman, Maria Assimakopoulou, said.
She
said the commission had already drafted a proposal to allow consumers
more flexibility to transport less-expensive beer or wine home, but
countries including Britain and Sweden had been holding up the plan since 2004.
The
court decision went partially against the opinion of the court's
adviser, who had suggested individuals be allowed to buy alcohol in
another country, have it delivered to their home and pay the duty only
of the country where the alcohol was bought.
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