Wine to rise by more than €1, retailers warn

Fri, Dec 7, 2012, 00:00

EXCISE DUTY:The cost of a bottle of wine to customers will increase by more than the €1 added in excise duty in the budget and will have a serious impact on independent outlets, according to wine importers and retailers.

Séamus Daly, who runs Quintessential Wines, a wine business in Drogheda, said an increase of €1 tax on a bottle of wine would equate to an increase on the shelf of about €1.50. He said because wine importers were being charged 23 per cent VAT on the cost of a bottle of wine, after excise duty had been applied they were “paying a tax on a tax”.

Added costs

The cumulative costs associated with excise duty, VAT and the margins of importers and retailers meant the real price to consumers would be more than the €1 announced. The new rates will apply to all wine which passed through Revenue-controlled bonded warehouses from here on in, he added.

Mr Daly said the tax would have “a huge effect on my business . . . I think people will invariably buy less.We now have the highest rate of excise duty of any country in the EU on wine.

“What it’s going to do in terms of retail is to encourage people to go to the North to do what are called booze cruises. There already is a market in Ireland for people illegally importing wine and I think it’s going to increase that as well.

“Up and down the country there are a lot of people running independent wine shops who will be very fearful that they might not survive the year ahead. People will default more to buying wine in supermarkets and the German discounters and I think it’s unfair because they are selling below cost because of their purchasing power.”

In On the Grapevine in Dalkey, Gabriel Cooney was experiencing a busy day as customers came to buy current stock. “This side of Christmas we’re going to be putting it up by €1,” he said.

Dominic O’Shaughnessy of the Wine Boutique in Ringsend, Dublin, said: “What is a very palatable €10 bottle of wine will now be €11.25 or €11.50 – that’s not going to sell at that price . . . We’re very, very worried for the future of the shop.”