Posted by on 6 May 2011. Filed under Current Affairs, Top news. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

Excise tax war puts strain on coalition, brewers and winemakers

The plan of the Ministry of Finance to hike up excise on beer and include wine in the system is starting to cause friction in the government coalition and has got the producers up in arms again.

The demise of the wine industry? (c) The Daily.sk

The concept of finance minister Ivan Miklos from coalition leader SDKU was already rejected earlier this week by the liberal SaS party, when party head Richard Sulik said his party would not support any further tax increases, and the OKS faction of Most-Hid has also joined the initiative. The KDH could also join in as it four of its MPs were against a similar plan last year.

Daily SME reports today how the brewers are lamenting how they are affected by excise taxes, while winemakers have enjoyed a free ride to date. Winemakers on the other hand, are grieving that their industry is suffering at the moment and that the breweries should not be using them as a negotiating tool.

Finance minister Ivan Miklos is determined to try to push through the plan, though, and so once again the coalition marriage could come under strain. According to representatives of the beer industry, a similar hike two years ago caused the closure of eight breweries in Slovakia and a drop in revenues by one fifth.

Maybe the endeavour of the finance minister to rake together finances is sometimes overzealous, or at least misdirected, as money is scattered to the four winds through various disadvantageous contracts and tenders in state administration. What about claiming money back from some of the numerous crony contracts, as previously proposed by controversial independent MP Igor Matovic.

The continual compromises that have to be made in a four-party coalition are also starting to take their toll on relations, as the various parties jostle for position and the interests of their ‘supporters’. I guess they will always manage to resolve their differences over a cold beer or glass of wine. Na zdravie!

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