IBA calls for reversal of excise increase on beer & cider
The Irish Brewer’s Association is the latest drinks industry organisation to call on the Government to reverse last year’s excise increase on alcohol - beer and cider in particular – which is creating significant challenges for the tourism industry and pub sector in Ireland.
Print2 September 2013
Bearing in mind that the Budget has now been brought forward to October, the IBA points out that tax now comprises 30% of the final price of a pint of beer or cider following last year’s 22% excise increase.
The current tax levels imposed on the sector are unsustainable and detrimental to Ireland’s economic recovery, warned the Association. Currently, taxes on beer are the fourth-highest in the EU and tax on cider is the second-highest. Irish beer tax is almost 10 times the level in Germany while cider tax is 1.6 times the level of the UK.
The Association stated that despite the significant challenges faced by the brewing sector, it continues to contribute significantly to the Irish economy through the 40,000 direct and indirect jobs sustained by the Irish brewing sector and the €0.5 billion it contributes to the Irish economy every year in purchases. This includes €200 million in primary purchases from the Irish agricultural sector including over 180,000 tonnes of malting barley and 46,000 tonnes of apples.
IBA Chairman David Smith commented, “Last December’s enormous tax hike on the pint was a costly error. It didn’t bring in the projected revenue the Government thought it would. Instead it damaged a struggling trade, led to pub closures and job losses. 30% of the final price of a pint of beer or cider is composed of excise and VAT. This is a situation which works against Ireland’s competitiveness as a tourist destination and in particular against the competitiveness of the Irish pub.
“The beer industry is particularly important for the tourism sector in Ireland. Two-thirds of the beer sold in Ireland is on draught and any further decline in beer sales would have a significant negative impact on the employment-intensive pub sector.
“Public houses are, in essence, small independent businesses, located across the country. Beer and cider remain the most important products in the on-trade offering and the recent excise increases have only served to depress an important sector of the domestic economy. The pub is cited as the number one attraction for tourists in Ireland according to the international travel guide publication, The Lonely Planet Guide. The protection of this sector is vital.
“Beer and cider production also remains vital to the economy in terms of indigenous manufacturing, providing jobs in major brewing facilities throughout the country. The brewing industry is an indigenous industry which has an economic impact in every part of urban and rural Ireland. The Irish Brewers Association is calling for a reversal of the excise increase on beer in order to facilitate Ireland’s economic recovery and protect this industry. To support the pub sector, the Association is also asking the Government to set up a task-force to assist in the sector’s recovery, to increase output and to generate employment.”
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