The Drinks Industry Group of Ireland (DIGI) has called for a 15pc cut in excise tax over two years to support the industry and align rates with other EU countries
A report commissoined by the group claims the Irish Government imposes some of the highest excise taxes on drinks and hospitality industry in the EU
It says industry and consumers are affected by high excise tax rates on wine, beer, and spirits, with a new report showing Ireland ranking high in excise tax rates, urging the government to reduce taxes to aid sustainability and growth.
Irish consumers are levied with the second highest excise tax rate in Europe, behind only Finland. Fifteen EU countries pay zero excise tax on wine while Ireland pays 80c per glass.
On a bottle of Irish produced whiskey, excise tax is over four times higher in Ireland than in Spain, with Irish consumers paying almost €12 compared to their Spanish counterparts who pay only €2.69 in tax.
On top of this, consumers also pay an additional 23pv VAT on alcohol purchases, meaning the Government is getting a total of 30-35pc of the retail price of every drink sold.
The report found:
- 70pc of people enjoy going to the pub to socialise,
- 82pc say that a restaurant as an enjoyable way to get out and meet people.
- 70pc of Irish people visit our traditional pubs and restaurants to catch up with family and friends,
- 58pc go to celebrate family occasions
- 27pc go to the pub to watch sport.
Kathryn D’Arcy Chair of DIGI and Communications and Corporate Affairs Director at Irish Distillers, said: “The Irish Pub is a unique cultural asset which attracts thousands of tourists to the country every year. Their value as a community hub and tourist attraction, coupled with Ireland’s world-renowned hospitality, should not be understated, as the economic contribution they bring to Ireland’s economy in this sense is significant. However, the value that this industry brings to Ireland is not reflected in policy or the level of recognition and support it receives from the government. It is time for the government to reset their approach to taxation and engage in long-term policy planning in order to revitalise the sector. A 15pc cut in Ireland’s significantly high excise tax rate would deliver an immediate reduction in the costs for thousands of urban and rural drinks and hospitality businesses. The continued high cost of doing business in Ireland has profoundly impacted Irish businesses in recent years. The drinks and hospitality sector has been particularly affected by the lingering effects of the pandemic, coupled with inflation, an energy and cost-of-living crisis, and a cripplingly high-cost base.”
Anthony Foley Associate Professor Emeritus, DCU said: “The data once again clearly demonstrates the very high levels of alcohol excise in Ireland compared to our EU neighbours which, of course, places a relatively large tax on the Irish drinks industry and consumers compared to other EU members. On the composite rate we remain the second highest in Europe behind Finland. The top four are Finland, Ireland, England and Sweden and the gap between these four and the other 24 countries remains large.”
