Publicans call for ten percent cut on liquor tax as pub trade continues to flounder


Maybe this is what's need to
revitalize Ireland's pub industry!
Irish publicans are calling on the government to reduce liquor taxes by 10pc in the upcoming Budget as what is arguably Ireland’s most iconic industry, the pub trade, continues to flounder.

Widespread cheap liquor-store drink and a shift in consumer spending from on-trade to off-trade liquor sales has taken a deadly toll on the publicans: the Drinks Industry Group of Ireland (Digi) said that the sector would be facing ‘meltdown’ unless some sort of governmental tax relief scheme is offered.

The call comes after news was leaked showing that Finance Minister Micheal Noonan would be seeking a 2pc increase in Ireland’s top VAT rate - from 21pc to 23pc - to help fast-track the economic recovery (at least according to him).

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The news would obviously result in a further increase in the price of already expensive on-trade drink, and chief executive of the Licensed Vintners Association Donall O'Keeffe said that without any ‘offsetting measure’ to offer a counterweight, the hike could be too much for some publicans to bear:

"This will inevitably lead to price increases and will act as a major disincentive to consumers to socialise and spend money in the hospitality sector," he told the Belfast Telegraph.

"It will exacerbate the severe difficulties being experienced by the on-trade in particular."

Sales at bars have dropped by almost a third in the past four years, according to the Telegraph  , while off-licence trade (liquor stores) have also recorded a drop in intakes, but not to the same extent. O'Keeffe told the paper that almost 38,000 jobs had been lost as a result of the declined spending.

Personally, I strongly agree with the publicans on this one.

Besides the jobs aspect, which can hardly be understated, there’s a social dimension to the situation too.

Alcohol Ireland as well as some politicians, are currently clamoring for minimum alcohol prices for Ireland, as are seen in some other parts of the world, as a way of curbing alcohol-fueled anti-social behavior, which has become rampant in some parts of Ireland.

Along with many others, I don’t like their proposal for a few reasons.

Primarily, I believe that if someone is stupid enough to overindulge on cheap alcohol - to the point that he/she is liable to cause others, or even themselves, damage - that’s their fault - why should others be prevented from availing of decent value beer/wine/etc if that’s what’s on offer?

Besides, by foreign standards, Ireland’s on-trade liquor prices are not that fantastically good value to begin with, perhaps with the exception of vodka, which can often be purchased for just €4 (~ $5.80) for 200ml. Combined with the high cost of living here, it seems like a crude punishing stick designed to deprive most of the population of one of the few reasonably priced items here for the stupid actions of a few.

Perhaps a more egalitarian approach would be to tackle the problem at its root: young people are drinking in more, and frequenting the pub less, because the differential between the price of a pint and that of a price of a can of beer is so glaringly obvious: €5 versus €1-€2.

As any former J1er will also immediately notice after returning from a summer in the States, Irish pubs do not seem to believe in offering deals of any sort to attract the masses.

Happy hours, TGIF deals, or any means of bringing the price of alcohol down in line with students’ budgets are very infrequently used tools in publicans’ promotional arsenal here.

Once the price of a pint falls below €4, it’s considered relatively cheap, which is shocking compared to what’s considered value in some parts of the world.

I’m not advocating reckless pub drinking, but pricing young people and students out of all but a few wallet-friendly pubs is simply asking for them to over-indulge at home, and compromising the quality of our cities’ nightlife for everyone.

The fault isn’t with the publicans, though, but with the government: excise on pints is deducted at 15.71 per hectolitre per cent of alcohol, before VAT and brewery costs are passed on.

The result is becoming increasingly obvious.
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