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Alconomics Sends Thirsty Drinkers on Crawl Around the Baltics
Latvia benefits from its neighbors’ moves to boost excise
The alcohol aisles inside a Maxima supermarket in the Akropolis shopping mall in Vilnius, Lithuania.
Photographer: Peter KollanyiThis article is for subscribers only.
Home to the world’s biggest drinkers, governments in the Baltic region thought they’d curb boozing and raise more revenue by hiking alcohol taxes. The only problem was that they didn’t coordinate.
While Estonia and Lithuania increased excise, neighboring Latvia was slower. The result? A flood of thirsty drinkers into the latter, whose budget has received a boost. Meanwhile Estonia is experiencing the opposite effect as the higher tax discourages domestic alcohol purchases.