Illegal alcohol has 50 pct market share in Estonia

TALLINN (BNS) - The share of illegal alcohol grew to 50 percent of the Estonian alcohol market in the first quarter of this year, a senior manager with the sales unit of the alcoholic beverages maker AS Liviko said on April 24.

Because of the lack of national alcohol statistics, the data is based on the intake of the alcohol excise tax and per-capita consumption of alcohol, said Janek Kalvi, sales director of trading company Liviko Kaubanduse AS. At the same time in 1999, the market share of illegal alcohol was 30 percent to 40 percent, Kalvi said, adding that the market share of illegal liquor has grown because of the higher excise tax.

The state budget loses nearly 1 million kroons ($62,500) in unreceived revenue daily because of the sale of illegal alcohol.

The country's customs authority seized 29,000 liters of illegal alcohol during the first quarter of 2000.

The Vodka Association, a body uniting Estonian strong alcoholic beverages makers, turned to the finance minister in February with a proposal to initiate a bill that would cut the excise tax on strong alcohol from the present 145 kroons to 115 kroons per liter.

Liviko's Finance Director Tiit Oim has said that because of the hike in excise rates, the production of alcoholic beverages in Estonia dropped 37 percent, and the production of spirits, 40 percent last year.

The shortfall in the intake of excise on alcohol spirits last year was 215 million kroons, with additional losses suffered by the state because of unreceived VAT on illegal alcohol.