The worst fears of the
trade were confirmed yesterday as the government increased taxation on both
Sherry and Brandy by 5%. Despite a previous increase four years ago which had the effect of slowing
sales and thus reducing its income from this tax, the government has gone ahead
anyway. This increase will need to be passed on to consumers, making all
products more expensive.
Evaristo Babé, president of Fedejerez,
expressed his disappointment saying that Sherry earns little for the exchequer
yet it is the only wine on which tax has been increased. He said that while
spirits represent 25% of the alcohol consumed in Spain, they represent 75% of
alcohol tax income. Beer, which accounts for 50% of consumption and table wine
with 25% remain untouched.
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| Cristobal Montoro, Finance Minister (foto:elconfidencial) |
For his part, César Saldaña, director of the
Consejo Regulador for Sherry, said that this was yet another obstacle for
Sherry which, after a huge amount of work, was beginning to recover. The secretary
general of the Federación Española de Vino (FEV), Pau Roca, said the government
move would cause more harm to producers of emblematic products than good to
attempts to redress the nation’s budget deficit. Tax increases will be imposed
from today. Meanwhile it seems that the government is wasting vast sums paying
out the pensions of 29,321 people who are dead, due to inefficient
cross-checking of data.
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