Germany to raise spirituous liquor tax by 20% in 2027

The German federal cabinet approved the 2027 budget, which includes a 20 percent increase in the excise tax on spirituous drinks such as rum, vodka and grain spirit. The rise also applies to sparkling wines, champagne and alkopops, while beer and wine remain exempt. The finance ministry projects additional annual revenue of about €455 million from the higher spirit tax.

The budget package also contains annual hikes to the tobacco levy starting in 2027, aiming for a pack of 20 cigarettes to cost over €11 by 2030, and an earlier‑than‑planned sugar levy on sweetened beverages slated for 2027. Health officials argue the measures will curb consumption and prevent roughly 1,000 cancer cases per year. The spirits industry has questioned the revenue forecasts, citing expected drops in sales and substitution effects.

Together, the tax adjustments are intended to strengthen the federal budget and support the statutory health insurance system while encouraging healthier consumer behaviour.