Drinks industry says call for tax hike ‘blunt instrument’

The drinks industry has hit back at calls from campaigners for a rise in excise duty on alcohol — saying it would hit a struggling sector and not impact on misuse.

A representative body for manufacturers, distributors and certain retailers said increasing the price of alcohol by higher taxation was a “blunt instrument”.

It said its main effect would be to drive consumers away from “safer drinking environments like the pub” to large multiple retailers, such as supermarkets, which sell cheap alcohol.

In addition, the Drinks Industry Group of Ireland (DIGI) said that such increases had damaged an indigenous industry, which couldn’t offset excise increases against other goods.

“Unfortunately, Alcohol Action Ireland have chosen to gloss over some of the inconvenient facts in their budget submission,” said DIGI spokesman, Bart Storan.

He said that, since 2007, 1,000 pubs had closed in the country and that 80% of the increase in the cost of a pint in the pub since 2011 was due to taxation increases.

He said large multiple retailers were selling deeply discounted alcohol by absorbing the excise duty increases and off-setting them against other goods.

Mr Storan said EU statistics showed the price of alcohol in Ireland was the highest in Europe and that, while consumption was down, dangerous drinking habits persisted. He said the Irish drinker paid €733 a year in alcohol tax, compared to €307 in Germany.

“The Government has approved an extensive package of measures to deal with alcohol misuse to be incorporated in a Public Health (Alcohol) Bill,” said Mr Storan.

“The package of measures to be implemented are expected to include provisions to deal with cheap alcohol on promotion, statutory codes for the marketing and advertising of alcohol, and a ban on price-based advertising. This year, the industry signed a pledge to introduce these policy options to tackle misuse.”

He added: “If we want to tackle alcohol abuse in this country, we need to take targeted measures such as these instead of making headline-grabbing pronouncements about measures which will cost jobs throughout the country by continuing to drive people to buy their alcohol on promotion.