Call to reduce ‘excessive’ excise duty on sparkling wines

Irish drinkers are continuing to pay through the nose for a bottle of wine with those who are fond of bubbles particularly hard done by.

That’s according to one of Ireland’s leading wine wholesalers and importers, who has called for an immediate cut in excise tax on wine.

Ireland currently has the highest rates of duty on wine and sparkling wine, along with the third highest rates of duty on spirits and beer in the EU.

"The tax is ridiculously high and this has a huge impact, not only in terms of tourism but also on simple activities such as eating out. The stock answer to why excise duty is so high is that it is to discourage people from drinking too much but there isn't a lot of evidence to show that it is working as a deterrent," said Neal Cassidy, managing director of Cassidy Wines.

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"There's no question that there are problems with alcohol in Ireland but despite the fact that we have the highest duty in the European Union we still have these problems so maybe we should be looking for other answers than just revenue raising," he added.

Cassidy Wines, which celebrates its 40th anniversary this year, is a family-owned importer whose clients including many of the country’s biggest supermarket chains.

Penalised

Mr Cassidy, who was speaking to The Irish Times after the company was announced as a return sponsor for the Dublin Horse Show, said consumers are being especially penalised for daring to like sparkling wines such as prosecco and cava, which have become increasingly popular in recent years.

Sparkling wine currently attracts double the rate of excise as still wines, something which Mr Cassidy claims is unfair.

“There’s a huge anomaly going on here. It [the excise] is something that would have been brought in at a time when it only really affected Champagne, which was obviously an ultraluxury product. However, nowadays there are many types of proseccos and cavas that are being bought. The excise duty makes the cost of very good, but relatively inexpensive sparkling wines, prohibitive,” he said.

Mr Cassidy’s father Kevin started the family business in 1977 by importing 400 cases of wine from Milan after some Italian friends complained about the lack of good wines in Ireland. Within two years, the company had been appointed as Italian wine buyer for Superquinn. It now employs 34 people at its offices in Citywest and has turnover of about € 21 million.

The businessman said the amount of wine consumed by Irish people had jumped from about two litres of wine per capita to 18 litres per capita over the last 30 years. During that time drinkers’ palettes have developed from sickly sweet German wines such as Blue Nun and Black Tower to Spanish Albariño and Austrian Grüner Veltliner.

The wine expert doesn’t expect consumption to rise substantially in the coming years however.

Lovely business

“On an overall basis the turnover of wine hasn’t increased by much but people are drinking better wines,” he said.

Mr Cassidy was involved in the business from its earliest days, although he also spent a number of years working as a quantity surveyor and for IDA Ireland, before joining the family firm on a full-time basis in 1983.

“It’s a lovely business and a heck of a lot more interesting than quantity surveying,” he said.

While the business undoubtedly has many bright moments (not least the countless wine-tasting trips in exotic parts of the world), the company has also been though its dark times too.

Tragedy hit the company in 1984, when Mr Cassidy’s brother Cormack, who was also employed by the firm, died after a plane he was on crashed. He was one of nine people who died in a group who were flying from Ireland to France to collect the first bottles of that year’s Beaujolas Nouveau.

The company also experienced tough trading conditions during the downturn.

“During the recession there was such a slump in trade that it was heartbreaking,” said Mr Cassidy.

However, with the economy getting back on track, the businessman is confident that notwithstanding the excessive duty which consumers have to pay, that they’ll continue to enjoy wine.

“Business is booming with old world wines back in vogue. We’re also diversified into craft beer and premium spirits and while they are a small part of overall turnover they are building very nicely,” he said.