Brewers stress €1.2bn contribution to economy and call for excise cut

Irish brewing is worth €1.2bn to the exchequer and supports 40,800 jobs, including 4,000 farmers, according to a new report.

The Irish Brewers Association welcomed the report, which shows the brewing sector’s contribution to the Irish economy.

Ernst & Young’s report The Contribution made by Beer to the European Economy, drawn up for the Brewers of Europe, calculates the economic impact of beer production and sales in Ireland as sustaining 40,800 jobs, giving an value-added effect of €1.3bn, and contributing €1.2bn to government revenue via Vat, excise and income-related contributions.

David Smith, association chairman and Diageo country director, said: “This report clearly demonstrates the significant contribution to the Irish economy made by the brewing sector. What’s truly fascinating is the tremendous impact that beer production has, both directly and indirectly, in terms of employment levels in the country.

“There is also a very significant value-added effect that beer production delivers. In 2012, the total value-add delivered by the production and sale of beer was estimated at over €1.3bn, a significant contribution to the Irish economy in anyone’s language. Additionally, this report makes it clear that the brewing sector contributes hugely towards Government’s revenue.”

In 2012, the revenues from excise duties, VAT and income-related contributions related to Irish beer production and sales were estimated at over €1.2bn, with over 76.8m litres of beer exported all over the world.

Due to the hugely important contribution beer makes to the Irish economy, brewers argue it should be supported appropriately. The beer industry and consumers have been subject to a 43% increase in beer excise duty in the last two budgets.

“This makes the tax they pay amongst the highest in Europe, which is killing jobs and could stunt potential expansion going forward,” said Mr Smith. “I would urge the Government to reverse this excise, in order to foster growth and bring new jobs into the sector, which will further the sector’s contribution to our recovering economy.”

The Ernst & Young report found that there was a fall in consumption by almost 10% between 2008-2012, high- lighting the high excise duty rates for beer in Ireland, compared to the rest of the EU, which has led to higher prices and has driven cash- strapped consumers to drink at home.

Despite this, the greatest part of beer consumption is still located in the hospitality sector at 61.2% and the report emphasises the significance of beer for this sector.

The economic contribution of beer to the hospitality sector and in particular the Irish pub is again recognised in the context of beer-related employment.

In 2012, approximately 1,500 people were directly employed in Irish brewing companies, while beer production contributed to the indirect employment of 40,800 people.

Some 32,000 of these jobs were in the hospitality sector alone; with beer at the heart of what is offered by Irish pubs to tourists.

The report also draws attention to the impressive innovations that have occurred in the brewing sector in recent years. It found that the 24 brewing companies in Ireland produced over 800m litres of beer in 2012 with over 76.8m litres of beer exported that year.


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