“Not to increase tax on alcohol” is a positive decision for the Irish wine trade. A big thank you is due to all those who worked on and contributed to the Support your Local campaign.
We are relieved to hear what the Minister was not going to do. However there is nothing to indicate that the huge increases in duty over the past two years will be reversed. We have no idea on the general direction of duty beyond the coming year. This is a problem for the trade.
Irish duty rates are too high. UK rates are about 22% lower on still wine and 28% lower on fortified. Double duty on some sparkling wines is anomalous. At 6.37 euros per bottle it is twice as high as the next highest duty rate anywhere else in the EU. Sparkling wine is growing in other markets. The potential to grow this category is hindered by double duty.
A return to duty levels closer to those applying before the last two budgets (2.78) with a reduction in the rates applicable to sparkling and fortified is now needed to bring Ireland into line with the rest of Europe and promote the growth and diversity of the wine trade in Ireland.