Government pours cold water on booze tax cut

A proposal to bring down booze prices has been put on hold by the Swedish government - to a mixed response from the country’s political parties.

Last summer the government’s own “alcohol investigator” Kent Härstedt controversially proposed a reduction of alcohol tax by 40 per cent. In practice, it meant that Swedish consumers would enjoy a price reduction of around 30 per cent at their local Systembolaget stores.

Härstedt’s proposal was targeted at the large army of Swedes who travel abroad and bring back bulk supplies of booze. A reduction in tax, he maintained, would entice them back to the state run alcohol monopoly and counteract the rise in the smuggling and peddling of alcohol in Sweden.

According to Wednesday’s Svenska Dagbladet, the government will address the issue again with their coalition parties, the Left and the Greens, in the autumn. Härstedt, however, maintains that that is too late and could cause the demise of Systembolaget as Swedes know it.

“There is a really serious risk that Systembolaget completely loses its role and there will be devastating consequences if we don’t get a reduction before the summer. The longer we wait, the bigger the reduction must be,” Härstedt told SvD.

Both the Left and the Greens are categorically against the move and emphasised that as the issue is “budget-related” the government is not at liberty to make this decision without their consent.

Left Party leader Lars Ohly told Swedish Radio on Wednesday: “The proposal is rather badly substantiated and does not correspond to the alcohol policies we already have in Sweden. If it comes up in the autumn budget negotiations, our position will not have changed.”

Meanwhile the Moderates and Folkpartiet are annoyed that the proposal has suffered a setback.

“We have said that it is time to lower alcohol taxes now,” said the Liberal Party’s Gabriel Romanus. “If the government doesn’t persevere with the issue we will take up the question again.”

“It is tragic from many perspectives,” said Lennart Hedquist, the Moderates tax policy spokesman.

“The government has tried to steer alcohol consumption with the help of prices,” he added. “It worked before but now it’s time to realise that we must turn to other methods. I agree that the change should happen as soon as possible to stop people buying alcohol abroad.”

Joining the protesters were the Centre Party and the Christian Democrats who did not mince their words on the issue. Party leader Göran Hägglund told SvD, “Frankly, the whole proposal should be thrown in the bin.”

SvD speculated that the government is thinking about implementing a reduction on June 1st before Swedes pack their bags for the holiday season.

However, a source told Swedish Radio that the government is waiting on Härstedt’s final report in March. They added that taken as a whole, Härstedt’s investigation – including public health recommendations and tougher penalties for smuggling and peddling – will make an alcohol tax reduction easier for the anti-lobby to swallow.

According to Härstedt that will be too little, too late. “The tax reduction should have happened already,” he said.

“Anyone who believes they are defending the restrictive alcohol policies by saying no to a reduction in alcohol tax is shooting themselves in the foot. The risk is that the sales in our stores will be so low that, in the end, we won’t have any Systembolaget left to defend.”

While Systembolaget is still standing, Wednesday’s Aftonbladet cautioned wine drinkers to check the sell-by date before they buy.

Its warning went out to connoisseurs of the “bag-in-box” variety following a spot-check exposé carried out by the tabloid.

Aftonbladet’s sommeliers told readers that a box of wine has a shelf life of six months with some red wines stretching to eight.

Concluding their five-store tour, Aftonbladet revealed they all had boxed wine over the sell-by date. Staggeringly one store had “eleven varieties which were older than eight months”.

Systembolaget’s defence was that boxed wine sales had depleted in Sweden and offered a candid response through company spokesperson Ann Burgaz:

“We know that we have old wine on the shelves in our stores,” she said.

Sources: Svenska Dagbladet, SR, Aftonbladet