Wednesday 16 January 2019

Struggling city pubs in call to cut tax rates

Dublin pubs struggling to survive want the Finance Minister to reverse last year's tax on beer and wine in next month's Budget.

"We have one of the highest rates of duty in Europe, if not the highest," said John Nealon, chairman of the Licensed Vintners' Association, which represents 600 pubs in the Dublin area.

Mr Nealon points to a duty of "28 cent on the price of a pint over the last three years and €1.50 on a bottle of wine".

"That brings the duty on a bottle of wine to around €3.50 and you have VAT on top of that. If you look at other European countries some have not duty at all and some have only seven cent on a bottle of wine," he said.

Mr Nealon, who owns the Blue Cafe Bar in Skerries, Co Dublin, says a combination of many factors is hitting pubs.

"The amount of duty charges by the government, more people drinking at home, random breath tests, the smoking ban and the fact that people have a lot less disposable income have all hit," he added


Mr Nealon said while it would be misleading to say every Dublin pub is on its knees, some pubs are really struggling, particularly in the suburbs.

"There are certain pockets, especially in the city, where pubs are doing well, but there are other pockets in the suburbs where they are not doing well."

The publican also stresses that competition from supermarkets is a big factor because "the wage cost of a unit of beer sold in a pub compared to a unit sold in the supermarket is a ratio of 8:1".

The LVA has made a written submission to the Minister Michaeal Noonan asking for the excise cuts.

"If he reversed the duty by the amount imposed in the last budget that would be fantastic."

Donal O'Keeffe, chief executive of the LVA said the last three budgets have been "penal on the pub trade".

The pint had been hit in the last three budgets by a 2pc increase in VAT to 23pc and a 10c rise in both the 2012 and 2013 budgets.

During that time the price from suppliers had increased by 4c and publicans had increased the price by 4c.


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