Drinks industry calls for 20% cut in alcohol excise duty

A package of stimulus measures to stem the tide of shoppers buying alcohol across the border were unveiled today by alcohol manufacturers and sellers.

A package of stimulus measures to stem the tide of shoppers buying alcohol across the border were unveiled today by alcohol manufacturers and sellers.

The Drinks Industry Group of Ireland (Digi) claimed employment in the sector dropped by a quarter in recent years years while the rate of consumption of alcohol fell by 16%.

It called on Government to cut tax on alcohol by a fifth and ban the selling of alcohol below cost.

Kieran Tobin, Digi chairman, also wants VAT on excise abolished and a 20% drop in commercial rates.

“Last December the Government gave consumers and our industry a very welcome boost through the excise reduction announced in the Budget,” said Mr Foley.

“This had an instant effect in stemming the flow of cross-border sales in advance of Christmas last year and in the first six months of 2010.

“Now, however, there is growing evidence that footfall levels in Northern Ireland are again on the increase. Also the accelerating decline in the on-trade is a major concern for the industry.

“In light of these developments, the Drinks Industry is proposing a package of measures to Government, designed to boost consumer confidence and support local businesses.”

Digi believes the package will help address the serious decline in the sector that has seen pub sales fall by 14% in the year to date, while simultaneously encouraging the public to support their local pub, restaurant, hotel, nightclub, and off-licence – boosting the wider economy.

In a report by DCU economist Anthony Foley, it was revealed that despite the recession the drinks industry continues to provide more than €2bn in VAT and excise revenues to the State.

Exports generate a further €1bn for the country, the study, named the Economic Contribution of the Drinks Industry, added.

Mr Foley said the sector was a significant contributor to the economy through the wide dispersal of 78,000 jobs, a €3bn turnover and exports generated by drinks manufacturers, pubs, bars, hotels and tourist centres.

“This economic analysis clearly shows that given the size and scale of the sector, it is logical that the Government should seek to support it, in whatever way it can,” he said.

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