Irish drinkers pay highest taxes on wine in Europe

Ireland’s wine taxes are the highest in Europe, a report reveals.

Irish drinkers pay highest taxes on wine in Europe

The report, published by the Irish Wine Association, also shows a decrease of wine sales of almost 10% last year.

The IWA that represents wine importers and distributors in Ireland has warned that excise is the number one threat to the wine industry.

Its annual Wine Market Review for 2013 shows an 8.2% drop in wine sales over the previous year.

A graphic published in the report shows Ireland has the highest taxes on wine in the EU, at €3.48 on a 750ml bottle.

Britain has the second highest tax on wine, at €2.68, followed by Finland at €2.77.

However, 15 countries pay no tax on wine, including Germany, Austria, Italy, Greece, Spain, and Portugal.

The report points out Spanish tourists pay almost twice the price for wine in Irish restaurants than they do at home.

The IWA says last year’s excise increases must be reversed because they were causing significant cash-flow problems for small businesses and putting thousands of jobs at risk.

The report outlines the impact that the 62% excise increase on wine has had over the last two budgets.

It says distributors and importers are spending an extra €17,958 in taxes on every 1,000 cases, creating massive cash flow issues for small to medium sized enterprises.

Last year, the industry paid €302m in excise to the Exchequer, with wine sales generating more than 30% of alcohol tax receipts. The IWA says this is a disproportionate share of the tax burden. According to the report, consumers spend €4.86 in taxes on a €9 bottle of wine, up from €3.53 in 2011.

The report also looked at the consumption habits of Irish wine drinkers and found they prefer white to red, with white holding a 51% volume share.

There has been a shift from red to white since 2003, when red wine had a 52% volume share.

More men (76%) than women (70%) over the age of 35 now drink wine, and Australian and Chilean wines are the most popular.

Michael Foley, chairman of the Irish Wine Association and sales and marketing director for Finlater Wine and Spirits, said it was an “extremely challenging” time for the wine industry.

Ireland’s high excise rates had hit consumers’ disposable income and put off tourists from returning to the country.

“The message coming from the industry is clear: reverse excise increases and support thousands of small businesses and jobs across the industry,” said Mr Foley.

He said more than 1,100 people were employed directly by wine distributors and importers, with thousands more supported in the 13,000 pubs, restaurants, and independent off-licences that sell wine.

He said the vast majority of the jobs were in small, family-operated businesses across Ireland.

According to the report 22 litres is the average wine consumption per adult and 75% of the wine purchased in Ireland costs between €7 and €10.99 a bottle.

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