The European Parliament (EP) has rejected a European Commission proposal to raise the minimum level of excise duty on alcoholic drinks after MEPs failed to agree on a number of amendments to the legislation.

Brussels had wanted to raise the minimum rate by 31% to reflect inflation since it was first fixed. The impact of the move would have been minimal as most EU countries already apply well over the minimum tax rate, though the proposal had been opposed by the spirits industry.

The EP has only a consultative role on tax issues but its failure to give a positive opinion means the legislation is now stalled and the matter will go back to its economic affairs committee