DIGI Calls For 15% Reduction In Alcohol Excise Tax
71 rural pubs closed in Ireland in 2018, according to a new industry analysis by the Drinks Industry Group of Ireland (DIGI).
DIGI's analysis of Revenue figures reveals that between 2005 and 2018, a total of 1,535 rural pubs closed in Ireland. During that period, 98 pubs closed in Mayo, 118 pubs closed in Tipperary and 313 pubs closed in Cork. These figures represent a decline of 21% in the number of pubs in Mayo, a decline of 22.5% in the number of pubs in Tipperary and a decline of 25.6% in the number of pubs in Cork.
In contrast, Dublin has experienced a net loss of only 10 pubs since 2005, which represents a 1% decline in the number of pubs in the capital.
According to DIGI, pubs in rural Ireland are particularly vulnerable to taxation policy, sudden tax increases, declines in inward tourism and economic uncertainty.
Alcohol Excise Tax
DIGI stated that the high cost of alcohol excise tax remains a source of significant concern for rural publicans, as well as for hoteliers, restauranteurs, off-licence owners, and other drinks and hospitality business proprietors.
As noted by DIGI, Ireland's rate of excise on wine is 25% higher than that of any other country in the EU, while the country's excise rate on spirits is 26% higher than that of the UK.
DIGI has called on the government to reduce alcohol excise tax by 15% over the next two years. The group wants the government to reduce the excise tax by 7.5% in Budget 2020 and by a further 7.5% in Budget 2021.
DIGI member and Vintners' Federation of Ireland CEO Padraig Cribben stated, "The number of rural pubs are down 20% in the period from 2005 to 2018, which is hugely worrying. This equates to 1,535 rural pubs, which are businesses that provide jobs, a hub in the local community for socialising, and community integration and a cultural powerhouse, which is among the main attractions for tourists visiting Ireland.
"In Limerick alone, hospitality and drinks businesses enable 6,997 jobs while in Meath, there are 205 pubs and 4,268 jobs supported by the industry. This demonstrates the scale of employment that this sector creates rurally.
"Considering this sharp decline in the number of pubs, we need to monitor this industry and ensure the necessary supports are in place to reverse this trend. While the government committed to assist small rural businesses recover during the recession, business owners in the drinks industry were challenged by two increases in alcohol excise tax in Budget 2012 and Budget 2013. Our high alcohol excise tax slows the growth of these businesses and impacts their day-to-day operations and bottom line. We are calling on the government to reduce excise tax to encourage the growth of our drinks and hospitality sector, return money to Irish consumers and make Ireland more competitive internationally, particularly ahead of a no-deal deal Brexit."
© 2019 Hospitality Ireland – your source for the latest industry news. Article by Dave Simpson. Click subscribe to sign up for the Hospitality Ireland print edition.