Latvian booze store says it will not sell building materials, after all

One of the giant alcohol retail stores near the Estonia-Latvia border said March 5 it was sticking to selling booze instead of paint, nails and laminated flooring.

"Due to the fact that Latvia raised the alcohol excise tax by 5% instead of the originally planned 30%... the GOALCO store in Ainaži continues to be a liquor store and the transformation into a construction shop is no longer on the agenda," 'Alco' CEO Veljo Madiberg reassured his thirsty clientele.

"In January, when deciding to transform a liquor store into a building materials store, we acted in the knowledge that Latvia had decided to increase its alcohol excise duty by 30 percent from March 1, and in February the Latvian parliament passed an amendment to increase its excise tax by five percent," Madiberg explained.

"Looking at the future of frontier trade, we do not forecast sales growth by 2020, nor do we foresee a decline. While Latvia lowered its alcohol excise tax curve six times a few weeks ago, the media reflected it from the perspective of ending frontier trade, while the fact that the 2019 alcohol tax cut in Estonia has not been reflected in local retail chain prices for most products. While some of the lowest-end spirits can be bought at lower prices in Estonian retail chains, premium products continue to have a 40% or more difference compared to frontier trade... If the cheapest price of beer is 1 euro per liter on the border, the prices in Estonia start at 2 euros per liter," he said.

The GOALCO store is just one of several that in recent years have served a strong demand from Estonians, Finns and other for alcoholic drinks at prices that are much cheaper than at home, with large retailers in Ainaži and Valka particularly popular.

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