Taoiseach leaves door open for cut in excise on alcohol 

Publicans want the cut as reduced Vat on hospitality does not apply to alcohol. But Alcohol Action Ireland says the value of excise duties has been eroded by inflation since 2014

Enterprise Minister Peter Burke is among the advocates of an excise cut, particularly as a measure to assist rural pubs which do not benefit from the reduced 9% Vat rate. Stock picture: PA

Taoiseach Micheál Martin has left the door open to a cut in excise on alcohol products just as Alcohol Action Ireland demands the Government raise minimum unit pricing in October’s budget.

Mr Martin said ministers had broadly discussed income tax issues ahead of the budget but have yet to formally begin talks on excise rates.

“But of course, given the propensity of the industry itself to raise the cost of alcohol, in terms of the price of a pint, which varies in different locations, we will look at that,” Mr Martin said.

“We will look at different sectors in the round. Are there other mechanisms that can be used to support them?

“But that issue hasn't surfaced yet at any of the talks that we have had.”

The Taoiseach did not respond when asked if he would have concerns about the knock-on impacts that the measure could have on health.

9% Vat 'does not benefit rural pubs'

Enterprise Minister Peter Burke is among the advocates of an excise cut, particularly as a measure to assist rural pubs which do not benefit from the reduced 9% Vat rate on hospitality.

The rate does not apply on the sale of alcoholic drinks, only on food and non-alcoholic beverages.

While there is a push from within the Department of Enterprise for the cut, there has been an acknowledgement it may be a difficult ask due to Ireland’s public health alcohol policies.

It comes as the chief executive of Alcohol Action Ireland, Sheila Gilheany, has written to Mr Burke raising concerns about proposed excise cuts on alcohol.

Excise duty impact 'eroded by inflation'

“Excise duties in Ireland have not increased since 2014 and in that time their value has been eroded by inflation by at least 15% so that their public health impact is being significantly reduced,” Ms Gilheany wrote.

“There is also a considerable gap between what is raised from excise duties - €1.2 billion annually compared with the annual cost of alcohol to the state finances of at least €14 billion.”

Ms Gilheany told the Irish Examiner that alongside an increase in excise on alcohol, the Government needs to raise the minimum unit price for alcohol.

Currently, the minimum unit price is 10c per gram of alcohol meaning for a 500ml can of beer with a 4.3% ABV, the minimum price which can be charged is €1.70.

She said any rise in MUP must be in line with inflation.

• Tadgh McNally, Political Reporter
• Louise Burne, Political Correspondent