Vintners disappointed tax on alcohol not reduced

Old reliables: While the general public may have breathed a sigh of relief that Mr Cowen did not increase excise duty on alcohol…

Old reliables:While the general public may have breathed a sigh of relief that Mr Cowen did not increase excise duty on alcohol, cigarettes or petrol, the Vintners' Federation of Ireland (VFI) believes Mr Cowen should have made a reduction.

Mr Cowen announced a 50 per cent reduction in the tax on beers produced in micro-breweries, but the VFI said duty on alcohol generally should have been cut.

The group said excise duty imposed on beer was 10 times higher than in Germany, while the excise duty on spirits was five times higher than Spain.

"It would appear that this Government is unable to understand the levels of tax imposed on drink in Ireland and as a result, competitiveness goes out the window," said VFI chairman Mr Seamus O'Donoghue.

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He added that, contrary to popular belief, most price increases are beyond the control of the publican. The VFI claimed its 6,000 rural members had experienced an average loss in business of 20-25 per cent since the introduction of the smoking ban.

ASH Ireland, meanwhile, said it was a retrograde step in tackling the "scourge of nicotine addition" that the price of tobacco did not rise. Although the number of cigarettes sold has fallen by more than 1.l billion since the smoking ban, ASH chairman Professor Luke Clancy said price increases were the single most important factor in deterring young smokers.

"It is imperative that price, a major contributor to the reduction of smoking levels across all sectors of society, will continue to be used," he said.

ASH Ireland had campaigned for a two-euro price hike on a packet of 20 cigarettes.

Professor Clancy said a reduction in smoking levels would aid the health budget by freeing up the thousands of hospital beds occupied by smokers.