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11th Aug 2022

Government might scrap wine and beer duty to ease cost of living

Ellen Fitzpatrick

No more €10 G&Ts?

The Government could scrap duty on certain alcoholic drinks in a bid to ease the cost of living crisis.

This comes as experts have warned that the current heatwave is set to add to costs per household, with higher food prices, extra electricity used for showers, air-con and refrigeration.

According to The Irish Mirror, the plan to scrap the alcohol duty is one of the many options in the Tax Strategy Report, which is being prepared by economists at the Department of Finance for minister Paschal Donohoe.

It calculates that a cut of 5% on a bottle of wine would cost the Exchequer just €3.2million, with the same amount being deducted from a pint of cider costing €4.2million and beer costing them €6.2million if they were to reduce it by one per cent.

Excise duty in Ireland is one of the highest in Europe, with €12 paid on a bottle of whiskey compared to it being €5 in France. In Ireland, we pay a €3 excise duty on a bottle of wine while other EU countries pay nothing.

Other ways to reduce the rising cost of living being considered are changing tax rates to give taxpayers up to €1,000 back and to increase social welfare payments.

Speaking yesterday, minister Donohoe didn’t rule these out, saying: “The papers present the options we will look at when preparing the budget next month, but they are not yet decisions.”

Drinks Industry Group of Ireland is claiming that the government can protect more jobs in the hospitality sector if there is a 7.5% reduction on excise tax on all alcohol products.

Chair Kathryn D’Arcy said: “If you want to promote Ireland as a great place to visit, then we must ensure we are competitive for those who visit the country. Reducing excise tax can be introduced overnight with an immediate impact.”