VARIOUS: EU court ruling means "booze cruises" continue

Europe's "booze cruises" were saved by a ruling of the European Union's highest court on Thursday (November 23) but consumers in high-duty countries such as Britain and Sweden had their hopes of buying cheap alcohol on the Internet dashed. The judgement came as a relief to finance ministries in nine EU countries with high excise duties, which had feared a potential loss of revenue from the key test case brought by a club of Dutch wine lovers. The European Court of Justice (ECJ) upheld a 1992 EU law that duty is charged in the EU state where goods are bought for personal use -- but only if transported by the purchaser. That effectively rules out cheap online sales. If someone orders alcohol in another EU state and has it delivered home, domestic customs duty must be paid, the court said. Britons, Danes, Swedes and Finns can continue sailing or driving to neighbouring countries with cheaper alcohol to benefit from the lower duty on personal imports. The court said that if a group was importing the wine, the home country duty should be paid, minus the duty paid in the country where the wine was bought. Britain, whose government hopes to collect 16 billion pounds ($30.5 billion) in tax from local tobacco and alcohol sales this financial year, warmly welcomed the ECJ ruling. The European Commission, which regulates EU cross-border tax affairs, was less impressed with the ruling and said the ECJ's interpretation of existing law seemed too restrictive. But it acknowledged that there was room to improve the rules.

ITN Source | November 24, 2006

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