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As new report shows value of beer to the Irish economy, Irish Brewers Association calls for 10 per cent excise cut

The Irish Brewers Association (IBA) has said that an excise reduction of 10% on beer is required in the upcoming Budget to boost beer sales, promote the Irish pub, and help Irish tourism. The Association made its call as new figures showed that the Irish beer market has declined by 3% in the year to date.

The Association said that despite this decline in market share, the beer sector continues to contribute significantly to the Irish economy, through the 45,000 jobs that are maintained in the brewing, distribution and sale of beer, and the over €1 billion in revenue generated for the State from beer sales.

It is also crucial to Ireland’s local manufacturing and agricultural sectors, while contributing greatly to the purchase of utilities from local authorities.

The IBA said that this contribution was highlighted in a new pan-European report by Ernst and Young/Brewers of Europe, The Contribution made by Beer to the European Economy**, which, in the section on Ireland, shows that:

· Irish breweries produced 8.249 million hectolitres of beer in 2010, slightly less than in 2008 (8.846 million hectolitres), but a marginal recovery on 2009 (8.041 million hectolitres).

· Consumption was relatively stable following a period of decline. The annual consumption per capita was approximately 90 litres in 2010.

· Beer is Ireland’s favourite alcoholic beverage. Most beer is consumed in pubs and restaurants. Around 66% of total beer sales is sold in the on-trade.

· Direct employment in the Irish brewing sector is 1,441 jobs. Employment in supplying sectors arising from beer production and sales is estimated at 5,880 jobs. The induced employment in hospitality is around 35,700 jobs while a little over 1,500 jobs in the retail sector can be attributed to beer sales. Total employment in Ireland due to beer production and sales is thus 44,540 jobs.

· Ireland has one of the highest excise duty rates on beer in Europe. Government revenues are estimated to be 1.134 million euro comprising 320 million euro excise, 524 million euro VAT and 290 million euro in income-related contributions and taxes.

Stephen Lynam, Senior Executive of the IBA, commented, “As this report shows, beer is the most important product for the Irish pub. It accounts for approximately half of all alcohol sold in Ireland. This means that the sale of beer is vital to sustaining Ireland’s pubs and wider hospitality sector which continue to be central to the economy and overall employment levels.

“In the tough economic climate, it is important to boost this sector in line with the Government’s reduction in the lower rate of VAT earlier this year.

“To support this, the Irish Brewers Association is a calling for a 10% reduction in excise duty on beer that will help boost the sector and sustain jobs at a time when the market is declining. We look forward to engaging with the Government on this in advance of the December Budget.”

17 Oct. 2011

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