Ireland: Communities Express Need to Raise Alcohol Tax

Alcohol has become much more in Ireland over the past decade

In a letter to the media, Dr. Sheila Gilheany, the CEO of Alcohol Action Ireland, presented a compelling case for raising alcohol taxes. Her analysis revealed that the real value of alcohol excise duties has decreased by 15% since the last adjustment almost a decade ago in 2014.

The 2022 report from the Commission on Taxation and Welfare also emphasized the appropriateness of using excise duties to reduce per capita consumption of alcohol and tobacco, particularly from a public health perspective. It underscored the importance of designing tax policies that align with public health goals.

A report commissioned by Alcohol Action Ireland reveals that alcohol is now almost 70% more affordable in Ireland than it was 20 years ago.

Researchers from the University of Sheffield came together to compile this report. The study considered data related to both the price of alcohol and its affordability over the past two decades. The report also uses data provided by the Central Statistics Office to establish that alcohol prices have kept pace with inflation in recent years.

70%

Growing affordability of alcohol raises concern

A report commissioned by Alcohol Action Ireland reveals that alcohol is now almost 70% more affordable in Ireland than it was 20 years ago.

Alcohol Action Ireland Report

However, it also goes on to show that the same is not true for off-trade alcohol, which is comparatively cheaper. The data shows that alcohol affordability in pubs and restaurants has only increased by 14% in the last 20 years. On the other hand, alcohol sold in shops and off-licenses has actually become 67% more affordable. This means that while excise on alcohol has risen overtime, their value has fallen considerably in relation to inflation levels.

When alcohol becomes more affordable, consumption rises and with it levels of harm and costs.

Senior Research Fellow Collin Angus highlighted the importance of linking alcohol taxes with inflation for better efficacy, according to The Independent reporting.

(Alcohol duty rates) haven’t changed since 2013 and recent high levels of inflation mean that they are now 15% lower in real terms. This highlights the importance of linking alcohol pricing policies to inflation in order to prevent increases in alcohol consumption and harm.”
Colin Angus, Senior Research Fellow, Sheffield Alcohol Research Group

Alcohol Action Ireland makes case for increasing alcohol tax

In a letter to the media, CEO for Alcohol Action Ireland Dr. Sheila Gilheany outlined the compelling case for why an alcohol tax increase is necessary.

The real value of the alcohol excise duty decreased by 15% since it was last increased in 2014. In its 2022 report, the Commission on Taxation and Welfare also noted that the use of excise duties to lower per capita alcohol and tobacco consumption was particularly appropriate. It is important that the design of the taxes supports public health objectives.

The World Health Organisation also recognises alcohol taxes as a key tool for governments to prevent and reduce alcohol harm. Rigorous scientific inquiry has consistently shown that alcohol price and affordability are key drivers of alcohol use. They are therefore key components to address for public health and social gains through lowering population-level alcohol use.

Irish economy looses billions – to alcohol industry’s gain

Countries such as Australia have already implemented automatic alcohol duty uprating systems to great effect.

In Ireland however, alcohol still costs the state €3.7 billion yearly while only raising €1.2 billion in taxes. Alcohol Action Ireland therefore recommends that alcohol duties should be increased by 15% at the very least to bring its value up to 2014 levels.

These calls for an increase have of course been met with fierce industry opposition. The industry contends that reducing excises would help sustain jobs in the industry.

3.7 Bn

Costs due to alcohol harming national economy every year

Alcohol harm costs the Irish government €3.7 billion yearly while alcohol taxes only bring in €1.2 billion in revenue.

Source

Why Australia Increases Its Beer, Tobacco Tax Every Six Months

Alcohol duties do not have negative impacts on trade and tourism in Ireland

Alcohol duties have so far not had any negative impact on commerce in Ireland. The number of pub licenses in Ireland decreased by only 1.3% during a period where there was an increase in excise duty on all alcoholic beverages.

The summary of Alcohol Action Ireland’s pre-budget submission in 2015 shows that the availability of cheap alcohol in the off-trade has greater impact on pubs than duties.

At the same time, increases in the alcohol excise duty in Ireland have reduced per capita alcohol consumption while generating revenue for the Exchequer. The decrease in duties in 2010 however had a detrimental impact on both the Exchequer and public health.

The decrease resulted in a reduction of excise receipts of €142 million . Overall alcohol consumption also increased by 6%. The increase in excise duty on all alcohol products in 2013 on the other hand resulted in a fall in consumption of 9.5%. Excise receipts for the state also increased by close to €150 million.

Public Health (Alcohol) Act of Ireland

The Public Health (Alcohol) Act was adopted into law in 2018 in the Republic of Ireland. The government has taken a stage-wise approach and is making steady progress in implementing the different provisions of the Act.

In 2019, several improvements regarding alcohol marketing rules stipulated by the Act came into force, including bans on advertising in public transport, 200 meters from a school, creche, or local authority playground, in cinemas except for films that are classified as over 18 and on children’s clothing.
In November 2020, section 22 of the Act came into force which saw the separation of alcohol in specified licensed premises.
- The introduction of this regulation is part of a process to de-normalize alcohol as an ordinary grocery product.
On January 11, 2021 section 23 of the Act came into force.
- This meant the implementation of measures to de-normalize alcohol in Irish society by banning multi-buy deals, short-term price promotions and loyalty points for alcohol products.
On November 12, 2021 section 15 which prohibits alcohol advertising in the sports area and section 16 which prohibits alcohol sponsorship came into force.
On January 4, 2022, section 11 which is the minimum unit pricing (MUP) policy came into effect.
Therefore, for the best efficacy of MUP, adjusting it to current inflation rate would be the next step for the Irish government.

Harnessing the voices leading change

Alcohol Action Ireland has launched an initiative to harness the lived experience of people in recovery from alcohol harm. The campaign seeks to direct these voices towards driving positive alcohol policy changes in the country. The Voices of Recovery initiative is being led by people in recovery from alcohol use disorder and addiction. The group aims to remove the stigma surrounding getting help for alcohol problems in addition to driving evidence-based policy changes. These include better alcohol treatment services, curbs on alcohol marketing and holding the alcohol industry to account.

Among the first ten signatories to the initiative are well-known recovery advocates Olympic boxer Kenneth Egan, Senator Frances Black and singer Mary Coughlan. Alcohol problems are a major concern for people and communities in Ireland, explained Professor Frank Murray, chairperson of Alcohol Action Ireland, as per RTE. This is due to the glorification, normalisation, and the marketing of the product.

We constantly hear from the alcohol industry – whether it’s through marketing or via the media looking for tax breaks, even as their profits soar. It’s long past time that we hear from the people affected by alcohol harm – the missing voice, up to now in the narrative around alcohol harm”
Professor Frank Murray, Chairperson, Alcohol Action Ireland