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Coca-Cola against excise tax on packs

  • 1998-11-26
TALLINN (BNS) - The Estonian subsidiary of the Coca-Cola Beverages company is protesting Parliament's decision to impose excise tax on packages of soft drinks.

Last week, the Parliament failed to adopt a bill that would postpone application of excise tax on them by one year. Instead of starting to pay package excise tax on soft drinks in 2000, producers will have to open their moneybags on Dec. 1.

Thomas Westerberg, director of the Estonian Coca-Cola subsidiary, said that the law is unjust because the tax applies only to a small portion of packages.

"For a law to be just, it has to take into account all packages, not just those of soft drinks," he said.

Westerberg said that the Coca-Cola company is also against the packaging excise law as it stands because it is not very effective or environment-friendly.

Two years ago, the Parliament adopted an excise tax bill under which the tax depends on the volume of packaging. Producers don't have to pay excise tax on packaging which is up to 40 percent reusable.

Westerberg complained that the law will cost the company a lot of money because it will have to repurchase all empty bottles. This move can also jump the price of Coca-Cola products.

The package excise tax has not brought a lot of cash so far. In the first ten months of this year, package excise tax revenues reached 1.9 million kroons ($410,700), only 29.24 percent of the target.