Wine industry in Ireland

Excise is the number one threat to the wine industry

The last number of years have been extremely challenging for Ireland’s wine industry. Penal excise increases of 62% - or €1.50 per bottle of wine – over the last two Budgets have pushed the industry to the brink. As well as being a tax on hard-pressed consumers, these increases have put a huge strain on the thousands of small businesses across Ireland that sell wine.

Over 1,100 people are employed directly by Irish wine distributors and importers, and thousands more jobs are supported in the 13,000 pubs, restaurants, and independent off-licences that sell wine. The vast majority of these jobs are in small, family-operated businesses across Ireland.

In 2013, the sector paid €302 million in excise to the Exchequer, a 30% increase on 2012. However, the same period saw volumes drop to 8.2 million cases – a fall of 8.2% from 2012.

In addition to the impact of a drop in sales, excise increases have created significant cash-flow issues for distributors and importers as many have to pay excise as an up-front cost. The total payment (including VAT) is now €17,958 higher per 1,000 cases than it was in 2012 at a time when the availability of credit is at an all-time low.

Ireland’s high excise rates have a huge impact on prices – hitting consumers’ disposable income and damaging the perception of tourists of Ireland’s value-for-money. Ireland has the highest taxes on wine in the EU, and due to the anomaly of sparkling wine excise being double that of table wine, our taxes on sparkling wine are astronomically out of line with the rest of Europe. Fifteen of the EU-28 charge zero excise on wine.

The message coming from the industry is clear: reverse excise increases and support thousands of small businesses and jobs across the industry.