62% excise increase on wine in the last two budgets
Support Your Local campaign highlights that from a €7 bottle of wine: €4.50 goes straight to the government
18 August 2014
The ‘Support Your Local’ campaign launched recently by the Drinks Industry Group of Ireland has highlighted “the unsustainable situation” that Irish wine SMEs are facing. A tax hike of 62% or €1.50 on the average bottle of wine in the last two budgetshas meant that wine has been the hardest hit alcohol category in the last few years.
According to Michael Foley, chairman of the Irish Wine Association: “Over 1,100 people are employed directly by Irish wine distributors and importers, and thousands more jobs are supported in the 13,000 pubs, restaurants, and independent off-licences that sell wine – their livelihoods are now at risk due to the actions of the government. Such unfair treatment of wine is crippling small businesses across the country. According to AC Neilson data to end Dec 2013, volumes in the industry are down 8.6%.”
He also pointed out that increases have added almost €18,000 to the cost of importing 1,000 cases of wine, at a time when the availability of credit is at an all-time low. This has put jobs at risk and has made it impossible to scale up and take on new talent.
Foley added that excise makes our tourism offer less competitive.Spanish tourists pay almost twice the price for wine in Irish restaurants that they do at home. Failte Ireland research has shown that the price of alcohol is one of the main reasons why tourists wouldn’t return to this country.
“Independent off-licences struggle to stay afloat in the competitive market, as it’s nearly impossible to compete with supermarkets selling wine as a loss leader. It’s shocking how much of the price of your drink goes to the government. Take a €7 bottle of wine – 64% or €4.50 goes straight to the Government. Wine that is priced greater than €9 has increased from 20% to 46% between 2012 and 2013.”