ECJ to rule on excise tax-free pálinka distilling

EU

The European Court of Justice is expected to rule on an issue near and dear to Hungarian hearts this week, as a decision regarding excise tax exemption for private pálinka distillers is forthcoming. 

Currently, up to 50 liters of excise tax-free pálinka is allowed to be distilled per capita, but local media reckons the ECJ will overturn this exemption: Daily newspaper Magyar Nemzet cited anonymous European Union sources in confirming the law would be overturned

The same news outlet reported that the National Economy Ministry is currently seeking a way around new EU legislation on the matter and Minister Mihály Varga pledged in a Friday press conference that he and his government would “defend the excise tax exemption for pálinka.”

In June 2012, the European Commission informed the Hungarian government that the tax exemption "goes beyond what is allowed under EU legislation." When no response or action forthcame from Hungary, the EC referred the case to the ECJ in February 2013.

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