Heavy Irish taxes on alcohol mean it is cheaper to buy a bottle of Irish whiskey in the US than in Ireland.
According to analysis carried out by the Irish “Support Your Local” campaign, whiskey lovers can expect to pay $47 for a bottle of Irish whiskey in Ireland, while American whiskey drinkers have to hand over just $30 for the very same bottle in the US.
Recent research has shown Ireland is the most expensive country in Europe in which to buy alcohol, with a massive 70 percent of the cost of a bottle of whiskey going to into the government's coffers through excise tax and VAT (Value Added Tax, that is, sales tax).
The Support Your Local campaign has now called on the government to reassess the effects the high tax levels have on Irish businesses and lower the tax on alcohol in the next budget.
“While Irish whiskey tourism is on the up and expected to grow by over 60 percent by 2025, visitors may be shocked when they find they can often purchase two bottles of Irish whiskey at home for the price [of one] in Ireland,” said Michael Storan, campaign manager of Support Your Local.
“Ultimately, Ireland is the shop-window for Irish whiskey and these high prices driven by high excise, are a worry to the industry.
“Excise also hits Irish whiskey distillers trying to get a foothold in the Irish market. They need a robust home market before they can scale to export the product. At the moment government policy on alcohol excise is simply not allowing this to be a realistic option.”
According to research from Support Your Local released in 2015, Ireland has the second highest rate of excise tax on alcohol in the EU and the highest EU excise in place for wine, a product on which 15 other EU member states pay no tax.
Sales of Irish whiskey have soared in the US in the past decade, rising 400 percent. Sales increased by 19 percent in 2015 alone, easily beating its main rivals from Scotland, Canada, and US home brands.
The Support Your Local campaign, sponsored by the Drinks Industry Group of Ireland (DIGI), aims to highlight the financial and social contribution made by the drinks and hospitality industry to the Irish economy and to Irish tourism, in particular.
As well as addressing the issue of alcohol misuse, DIGI focuses on the drinks industry's economic contribution in Ireland.
To coincide with the launch of their 2016 campaign, DIGI released their commissioned report from economist Tony Foley revealing that 204,000 Irish jobs are supported by the drinks industry across as many as 7,193 pubs, 3,233 off-licenses (liquor stores), 631 licensed hotels and 2.406 licensed restaurants.
The report also showed an increase in the number of craft breweries and distilleries throughout the country, with 57 now in operation.
Foley estimated that these aspects of the hospitality sector have a combined turnover of $7.9 billion (€7.1 billion).
“The national economic impact of the drinks industry and wider hospitality sector is substantial. Of note is the fact that the drinks industry and wider hospitality sector makes a significant contribution to the economic life of towns and villages outside of urban centers,” Foley said.
“This is supported by the vast network of pubs, restaurants, hotels and independent off-licenses, which have a presence in every constituency across Ireland.
“One key driver for growth in the drinks industry is craft – with a huge increase in the number of breweries and distilleries opening across Ireland in recent years.”
Storan added: “In 2016, the Support Your Local campaign will be continuing to highlight the positive contribution of the drinks and wider hospitality sector over the coming months … When we say ‘Support Your Local’, we are calling on communities to support your local farmer; support your local distillery or brewery; support your local pub, restaurant, hotel or independent off-license; and support your local community.”
Whiskey tourism has been on the rise in Ireland with new tours and whiskey academies emerging.
In general, the consumption of alcohol in Ireland has fallen in the past few years, after reaching a high in 2001. Data collected by Dublin City University Business School found that consumption had fallen by 23.9 percent in the last 15 years. We now rank ninth on the Organisation for Economic Co-operation and Development's (OECD) list of countries by annual per capita alcohol consumption.
H/T: Irish Times