Estonian President Kersti Kaljulaid has refused to sign a law introducing a tax on sweetened beverages in Estonia, arguing that it breaches the nation's constitution.
Legislation passed by the Estonian parliament and sent to the president last month would impose a tax on beverages containing more than five grams of sugar per 100 milliliters.
Under the legislation, drinks were to be taxed at EUR0.10 (USD0.11) per liter when they contain concentrations of sugar of 5-8g per 100ml, rising to EUR0.30 per liter on sugar concentrations of 8g per 100ml. The tax rate for drinks containing an artificial sweetener would be EUR0.10 per liter.
However, while President Kaljulaid said that she agreed with the sugar tax in principle, she could not proclaim the law in its current form because an exemption granted to sweetened drinks sold on flights and passenger ships bound for foreign destinations was unconstitutional.
"I will hereby leave the sugar tax law unproclaimed as my standpoint is that it is not in accordance with the principle of equal treatment set out in the 12th paragraph of the Constitution," she said in a statement.
"This regulation gives undue advantage to a single sector and the legislature is not in line with the constitutional principle of equal treatment," she added.
It is understood that the sugar tax will be discussed again by parliament in its autumn session.