Drinks and hospitality body warns of 'recession-type' decline if Boris becomes PM

DIGI recommended that the government reduce the excise tax on alcohol by 15% over the next two years in order to deal with this issue.

Drinks and hospitality body warns of 'recession-type' decline if Boris becomes PM

Should Boris Johnson defeat Jeremy Hunt in the Conservative Party leadership race this week, it could lead to a "recession-type" decline in the drinks and hospitality sector, according to stakeholders.

The Drinks Industry Group of Ireland (DIGI) says that a no-deal Brexit, which would end tariff-free trading between Ireland and the UK, could be detrimental to the industry.

The group stresses that the fact that Ireland has the second-highest overall excise tax in the EU only adds to the risk.

Mr Johnson has repeatedly said he intends on taking the UK out of the European Union with or without a deal on October 31.

Should this happen, the UK and EU will have to negotiate a bilateral trade deal - something DIGI speculate could take years. With visitor numbers coming to Ireland from the UK already down according to the CSO, this is concerning for the DIGI.

"(Boris Johnson's) election would greatly increase the chance of a no-deal Brexit, which, by extension, would jeopardise the long-term growth prospects of Irish drinks and hospitality businesses that depend on stable British tourism and exports markets," said Rosemary Garth, Chair of DIGI and Director of Communications and Corporate Affairs at Irish Distillers.

“A large-scale and long-term reduction in visitor numbers from the UK would have dire ‘recession-type’ effects on the drinks and hospitality sector, particularly in rural Ireland, and lead to job losses and business closures.

“Given the drinks and hospitality sector’s massive contribution not just to the Irish economy but Ireland as a tourism brand, our Government must do everything in its power to reduce the grave harm that a no-deal Brexit would have on thousands of businesses and more than a hundred thousand jobs.

DIGI recommended that the government reduce the excise tax on alcohol by 15% over the next two years in order to deal with this issue.

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