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European Commission Asks for Elimination of Taxation Perks on Tsipouro and Tsikoudia

tsipouroTwo popular traditional Greek alcoholic spirits could soon become more expensive.
In a report published on Thursday the European Commission orders the Greek government to change its taxation schemes for tsikoudia and tsipouro.
The European Commission criticized the Greek government for its “super-reduced” tax rate on Tsikoudia and Tsipouro. According to the Commission this amounts to a 6% of the actual excise duty. Drinks made with ethyl alcohol, such as tsipouro and tsikoudia, should be taxed equally across the board per European Union, rules the Commission claims.
Tsipouro and tsikoudia are similar drinks. The main difference between the two occurs in their production process as tsipouro is made through a double grape mark distillation while tsikoudia by single mark distillation.
“Exemptions or derogation is provided explicitly by EU law and must be strictly interpreted. Greece does not have any derogation for “Tsipouro” or “Tsikoudià”. The Commission believes that both schemes infringe on the relevant EU excise duty legislation and also favour a domestically-produced spirit drink over spirit drinks produced in other Member States. This is an infringement of EU rules on the free movement of goods,” the Commission notes.
The report warns the Greek government of potential consequences if it does not comply with this directive.
“The Commission’s request takes the form of a reasoned opinion. In the absence of a satisfactory response within two months, the Commission may refer Greece to the Court of Justice of EU,” the reports reads.
In the past, the Organization for Economic Cooperation and Development had advised the Greek government to ban the sale of draft tsipouro due to the financial losses and health hazards this trade comes with.

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