Call to cut excise as sales of wine rebound in Ireland

Republic has the highest excise in the European Union, at €3.19 on a standard bottle

Grapes of wrath: since 2012, excise on wine has risen by 62 per cent in Ireland with the tax take from a standard €9 bottle increasing from 39 per cent to 54 per cent. Photograph: EPA

Grapes of wrath: since 2012, excise on wine has risen by 62 per cent in Ireland with the tax take from a standard €9 bottle increasing from 39 per cent to 54 per cent. Photograph: EPA

 

Excise on wine is now 106 times higher in Ireland than in France, according to a new study, which reveals that despite this, sales continue to rebound.

The report, which was compiled by the Ibec-affiliated Irish Wine Association, reveals that 8.5 million cases of wine were sold in Ireland in 2014, compared to 8.3 million a year earlier.

Nonetheless, sales are still lower than in 2011 when they reached a record high of 9 million cases.

The association has echoed recent calls made by drinks giant Diageo and Jameson Whiskey maker Irish Distillers, to reduce excise in the forthcoming budget to stimulate growth and protect jobs.

According to the new report, Ireland continues to have the highest excise on wine in the European Union, at €3.19 on a standard bottle. This is 12 per cent more than in the UK, the second most expensive country. Some 14 EU member states currently charge no excise at all on wine.

Since 2012, excise on wine has risen by 62 per cent in Ireland, with the tax take from a standard €9 bottle increasing from 39 per cent to 54 per cent during that time. The latest study shows total excise payable to revenue is now €14,640 higher per 1,000 cases than three years ago.

In 2014, the wine sector paid €354.6 million to the Exchequer, equating to 31 per cent of total alcohol excise collected. The sector also contributed approximately €280 million in VAT receipts.

It is estimated that 1,100 people are directly employed by distributors and importers with thousands more in the 13,000 restaurants, independent off-licences and hotels that sell wine Ireland.

The association’s chairman Michael Foley said the high cost of wine in Ireland was putting jobs at risk and making it impossible for sellers to scale.

“Excise is the number one threat to the Irish wine industry,” he said, adding that it was also affecting tourism, with visitors from Spain, for example, paying almost twice the price for a bottle in a restaurant here than they would at home.

The latest study shows that despite the high cost of wine, it remains the country’s second favourite alcoholic beverage after beer with 27 per cent market share, up from 19.9 per cent in 2004.

White wine is the most popular tipple, representing 50 per cent of sales, followed by red at 47 per cent and rosé at 3 per cent.

The report also reveals that Chile has now overtaken Australia as the leading country of origin with a 23.5 per cent market share and sales of almost 2 million cases last year. France, Spain and Italy are the other most popular countries for wine.