Europe could make wine cheaper in Sweden

Swedish wine-lovers could get a welcome break from the EU if the European Commission wins a case due to open against the Swedish government this week.

Sweden is being sued by the Commission for imposing higher taxes on wine than on beer. The reason for the difference, the Commission says, is to protect Swedish beer producers and to disadvantage foreign winemakers.

The dispute started in 1997, when Sweden heavily reduced tax on beer. The Commission started proceedings against Sweden. Sweden says a reduction of taxes on wine in 2001 answers the criticisms.

Taxes on beer is 1.47 kronor per percentage point of alcohol. If tax on wine was the same as that on beer, the average price of a litre of wine in Sweden would fall from 65 kronor to 61 kronor.

Sweden argues that for the Commission to win its case it must prove that the tax on beer, and therefore its retail price, is so much lower that consumers choose beer instead of wine.

“We argue that wine is at least twice the price of strong beer in any case, and that if this small change was made in tax levels the difference in sale price would still be so big that people still wouldn’t change to drinking wine just because of that,” said the Swedish Foreign Ministry’s Karin Wistrand, who will be attending the hearing in Luxembourg on Tuesday.

The court’s Advocate General will give his opinion on the case after Tuesday’s hearing. A final ruling from the 13-strong panel of judges in unlikely to be passed down before the end of the year.