Clare Moody

MEP for the South West and Gibraltar

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EU cider tax meeting leaves door open to exemption

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Clare hosted representatives of south west cider and perry producers for a meeting with one of Europe's top-ranking tax officials in Strasbourg on Tuesday, over fears that an excise duty exemption for small scale cider producers could soon end.

The European Commission has requested that the UK Government scrap an excise duty exemption for producers whose output is less than 7,000 litres a year, worth £2,500. When the EU Alcohol Excise Duties Directive was first established in 1992, the UK Government neglected to submit an exemption for cider, which it did for beer. Instead, in 2002, the Labour Government unilaterally established its own exemption. In February this year the Commission wrote to the UK Government, requesting that evidence in defence of the exemption be submitted within two months. The UK Government never responded. 

Clare arranged for delegates from CAMRA, including Guy Smith of the Somerset Cider Company, to speak directly with officials from the office of Pierre Moscovici, European Commissioner for Economic and Financial Affairs, Taxation and Custom. David Boubil, representing the Commissioner, listened to the delegates concerns, primarily that the duty would cripple smaller producers, forcing many to close, whilst yielding very limited revenues. They explained that as a likely consequence, the traditional method of cider and perry production, integral to British culture and tradition, would steadily decline.

Mr Boubil said that the Commission understood these problems. He explained that the current Directive is now under review pending consultation. A report is expected later this year, which could allow room for member states to submit fresh exemptions, such as for cider and perry producers, or a complete revision.

Speaking after the meeting, Clare said: 

“I’m pleased that we were able to hold this very encouraging meeting. I hope now that the Commission better understands the difficulties the directive presents to the unique position smaller producers occupy. 

"Cider making has a long history in the south west and small-scale, artisan producers play an important role in that tradition. If these producers are driven out of business it will cost jobs, harm the countryside, reduce consumer choice and cause irreparable damage to this great British tradition. 

"The Commission was clearly sympathetic to the plight of smaller producers both in the UK and other member states. Nevertheless, the UK Government needs to take action to protect their interests and should start by engaging with the relevant authority.

“The Commission invited the delegates to submit their concerns as part of the consultation on the Directive, ahead of the report due later this year. I am hopeful that this provides a realistic opportunity to resolve the issue and look forward to working closely with all parties to achieve this."

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