Vice Squad
Sunday, August 12, 2007
More on Sweden and Alcohol

Sweden's high tax/public retail monopoly regime for alcohol has been under assault from the EU for some time. It's a standard free (or non-discriminatory) trade versus vice policy collision, not unlike the one that the US has going with Antigua and the WTO concerning internet gambling. Last month, an EU court adviser indicated that the much higher taxes applied by Sweden to wine than to beer were a form of disguised discrimination, because much of the beer is Swedish whereas most of the wine is imported. But it's perfectly sensible to tax higher alcohol products more highly, so once again, Vice Squad sides with a country's domestic vice policy over the free trade mandates; in the long run, I think that allowing trade rules to trump domestic vice policy is likely to harm both vice policy and commitment to free trade.

The EU court need not follow the advice, however, of either Vice Squad or of the official adviser.

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