Mail-order booze cannot be duty-free, rules European Court
Personal shoppers can continue to bring in up to 90 litres of wine for their own use from any country in Europe without having to pay extra taxes on it.
But they cannot have it delivered to their door tax-free at a saving of up to €2 a bottle, the court ruled after a Dutch wine club brought an action.
Anybody ordering alcohol in another member state and having it delivered to their home must pay their home-country tax, minus whatever tax they paid when purchasing the goods.
The Irish State stood to lose a greater share of its revenue than most others since Ireland has the highest rates of excise duty in Europe and among the highest VAT rates.
Commenting on the judgment, Rosemary Garth, director Drinks Manufacturers of Ireland, said the case made people aware of the high level of tax on alcohol.
“Ireland’s disproportionately high levels of excise duty will need to be addressed at some point,” she said.
Ms Garth said it is very difficult to estimate what quantities of alcohol are brought into Ireland every year. But she believes in the long run the Government will have to bring excise duty rates more into line with the rest of Europe.
As the law stands the UK loses about €1.8 billion a year as thousands of Britons travel by the channel tunnel or by ferry to France where alcohol is much cheaper and stock up.
Sweden, Denmark and Finland are other high tax countries bordering those with lower rates of duty and they too lose substantial revenue from cross border shopping.
The differences in taxes are big with Ireland charging over €2 on a bottle of wine while nine other EU countries do not charge any duty.
There is an equally big divergence on tax on beer, spirits and cigarettes.
Last year the Government collected €1.038bn in duty on alcohol — about half of this from beer but a growing percentage from wine — and €1.08bn from tobacco.
Commenting on the court decision Fianna Fáil MEP Brian Crowley said, “The European Court of Justice has got the balance right here today between protecting an individual’s right to bring alcohol from one member state to their home state and the right of member states to generate tax revenues.”
The court decision was different to the legal advice it received from the Advocate General that said alcohol for personal use up to the limit permitted could not have duty imposed even when it was delivered by someone else to your door.
If the court agreed with this it would have affected not just alcohol but tobacco, petrol and diesel and cars being imported from one member state to another.
The European Commission argues that the different levels of tax prevent the EU single market operating properly and forcing competition cross-border.
But efforts to harmonise taxes have failed so far and even an attempt to raise the minimum rate of excise duty on alcohol was thrown out by the member states in September even though it did not apply to most countries that had much higher levels.
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