Excise duty cut "will benefit the Irish food sector"

Food and Drink Industry Ireland (FDII) has welcomed the reduction in excise duty on alcohol saying that it would "have a positive benefit on the Irish food and drink industry".

FDII Director Paul Kelly said: "High levels of excise duty on alcohol and the resultant price differential has been a major factor in driving Irish consumers across the border.

"This has had a knock-on effect on the grocery market with €900m worth of lost sales south of the border. This has delivered extra value to consumers with food prices reducing by over 6%.

"Value will continue to improve even further in the New Year when Irish VAT reduces by 0.5% and UK VAT increases from 15% to 17.5%."

Retail Ireland Director Torlach Denihan said: "The cut in excise duty will help reduce the numbers going North to shop. The purchase of alcohol is a major factor in the increase in cross border shopping, which is resulting in a massive loss in revenue to the exchequer and 11,000 job losses in the retail sector this year. "

The group also welcomed the Minister for Finance's acknowledgement of the difficulties facing the retail sector, and the major problems created by the massive devaluation of sterling and tobacco smuggling.

"Improved consumer confidence is an essential prerequisite to a recovery in retail sales. The firm action taken to stabilise the public finances should help provide consumers with the confidence to begin to spend again," Mr Denihan said.

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