Beer sales on Estonia’s northern border increased 2.2-fold YoY in July, according to the Estonian Breweries Association.
Last month beer sales across Estonia increased approximately by 45%, while the sale of cider and other low-alcohol by volume (ABV) beverages rose by 37%, the association said.
Beer producers’ July sales figures indicate that the Estonian market is recovering rapidly following an excise duty cut that entered into effect on July 1. According to these figures, association members sold approximately 10 million liters of beer in Estonia last month, up by 45% from 6.9 million last year.
“Thanks to the excise duty cut, the volume of taxable liters for low-ABV beverages increased altogether by 43% in Estonia in the first month following the tax cut already,” Estonian Breweries Association CEO Peeter Vork said, noting that this confirmed the positive impact of the excise duty cut in the low-ABV beverage sector, even despite the fact that July 2018 was exceptionally warm.
“It cannot be concluded from growing sales in Estonia that Estonians have begun consuming more alcohol,” Vork continued. “As already noted, there is a significant impact from the northern border as well as a significant impact in various regions within Estonia, where the price decrease has quelled the financial motivation to bring in products from the Latvian border.”
Although it is too early to draw conclusions regarding tax receipts, the association is convinced that excise duty cuts will have a clearly positive impact on the state budget.
“It is therefore right that purely economic arguments are the reason for cross-border trade,” the CEO added.
The Estonian Breweries Association is an umbrella organization for major Estonian producers of beer and other low-ABV beverages. The association’s sales statistics have been collected from member organizations. Association members’ share of revenue on the Estonian market is over 90%. (ERR/Business World Magazine)
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