Retailers: Alcohol License Fee Would Increase Prices for Customers

Estonian retailers say plans to introduce a new fee for alcohol licenses would increase prices for customers and could reduce the number of stores selling beer, wine and spirits. Currently, 10,000 alcohol sales licenses have been issued in Estonia, with numbers rising in recent years, some obtained just in case.

The Ministry of Social Affairs is considering implementing paid licenses, following World Health Organization (WHO) recommendations to reduce the number of outlets. Currently, 90% of Estonia's residents can reach a liquor store within 10 minutes.

The Leesi village shop in Juminda, where alcoholic beverages account for up to 30% of sales, would be affected. The cooperative, founded by locals, already sells goods at slightly higher prices than larger chains.

Ants Viirmaa, member of the management board of the Leesi cooperative, said little will change if the fee is "symbolic." "But every tax is always ultimately reflected in the final price. If it becomes very high, it will certainly have an impact. It will be added to the price of the bottle, and the danger here is that if the price of the bottle becomes too high, then alcohol will simply, figuratively speaking, move from the shop to behind the shop," he said.

For the Rikets flower shop chain, alcohol is an insignificant side business. If a customer wants to add a bottle of wine to an online order, they can. But if the license becomes commercially unprofitable, the chain will give it up. "It depends on what is decided, for what amount, and how much bureaucracy comes with it. If it is very complicated and expensive, then there is no point in my doing it," said CEO Getriin Hermlin.

By the end of the year, an analysis will be completed on what kind of sales license system would be suitable for Estonia. Kristiin Mikko, adviser at the Ministry of Social Affairs, mentioned possible systems where a license is more expensive in areas with high density of alcohol outlets.