Ireland has the second-highest beer excise tax in Europe, behind only Finland.
According to the latest report, 80 cents on every glass of wine and €12 on every bottle of whiskey go straight to the Exchequer.
France, in comparison, charges just one cent on a glass of wine. Excise on the same bottle of spirits bought in a French off-licence is less than €5, and in an Italian off-licence less than €3.
DCU economist Anthony Foley says that while Ireland’s beer industry is world-renowned like Germany’s, Irish punters pay 1,000% more excise tax on their pints.
The report commissioned by the Drinks Industry Group of Ireland (DIGI), Alcohol Excise Tax in Europe: Where Does Ireland Rank? shows that Irish punters pay 55 cents in excise tax on a pint of lager. The same drink served in Germany is subject to a much smaller levy of just five cents.
‘It’s nearly impossible for a small bar to operate profitably’
Ireland’s levy on cider is double that of the UK’s – €94.46 vs €45.51 per hectolitre of product. In addition to excise tax, VAT is also charged on alcohol at a rate of 23%.
Andy Ferreira of the award-winning Cask cocktail bar on Cork’s MacCurtain Street believes the rates are stifling new business:
“Ireland is one of the few countries in the world where you don’t see bartenders and bar managers taking the step up to being outright bar owners.” he told Yay Cork.
“It’s just not financially viable unless you have a minted backer. It’s nearly impossible for a small bar to operate profitably and a huge part of this is the outlandish excise duty bars have to pay.”
Ferreira believes this has a detrimental effect on the quality of bars in Ireland:
“It means only rich businessmen who invariably operate multiple bars can survive in the market.” he added.
“The creative, driven, younger generation don’t stand a chance.”
DIGI, ahead of Budget 2019, is calling on the Government to reduce Ireland’s high alcohol excise tax.
“Together, manufacturers, distillers, brewers, pubs, off-licences, restaurants, hotels the length and breadth of the country generate €2.3 billion in revenue for the Exchequer every year.” said Donall O’Keeffe, Secretary of DIGI and Chief Executive of the Licensed Vintners Association.
“A smaller tax would allow businesses to spend more money on expanding into new markets, developing new goods and services, refurbishing and expanding premises, and creating new jobs.”