Finland: Alcohol Tax Increase Is Coming

Finland: Alcohol Tax Increase Is Coming

The Finnish government plans to introduce increases in alcohol and soft drink taxes laid out in the government programme in full as early as next year.

The increases which will be introduced in a front loaded manner are expected to generate additional tax revenues of €50 million from alcohol and €25 million from soft drinks, as stated by Minister of Finance Mika Lintilä.

The political decisions on the increases are to be made in the first framework budget session of the government of Prime Minister Antti Rinne (SDP) on September 17-18, 2019.

If the taxes are raised for alcohol this would be the 8th time over the past decade Finland has increased alcohol taxes. The most recent tax increase at the beginning of the year generates €30 million in tax revenue for the government.

The Finnish government takes continued effort to place greater emphasis on lifetime emissions and health effects in taxation. In this view the government,

  • will impose new requirements on the food industry,
  • is drafting an action plan for making the food system climate sustainable by 2030.

However, whether or not the alcohol tax increase will generate the expected revenue also depends on alcohol tax cuts in Estonia and Latvia.

Tax increases are a proven effective best buy policy measure in alcohol control recommended by the WHO.

Despite the strong alcohol control policy measures in Finland, cross-border alcohol trade from Estonia and Latvia affects alcohol consumption levels in Finland. With both their neighbors slashing taxes, more and more Finnish people go to these countries to purchase alcohol, which inadvertently increases alcohol harm for Finnish people.

For further reading:

North-East Europe: Escalating Struggle Over Alcohol Taxation

Source Website: Helsinki Times