The Republic of Ireland delivered the 2022 Budget on October 12, 2021, in a joint speech by Minister Donhoe and Minister for Public Expenditure Michael McGrath.
The Budget 2022 has abandoned the alcohol tax increase for the coming year in a controversial decision, contradicting the Irish government’s latest improvements in alcohol policy.
According to the speech, not increasing taxes was a decision taken to relieve bars and restaurants opening up after the pandemic. However, supermarket alcohol will also not see a tax increase because of the controversial decision. Cheap alcohol in supermarkets are a bigger threat to bars and restaurants than increasing public health alcohol excise taxation because small businesses can not compete with the ultra-cheap alcohol sold in supermarkets.
Furthermore, cheap, high strength alcohol sold mainly in supermarkets is a key driver of alcohol harm in Ireland. As Movendi International previously reported, the annual alcohol price study, conducted by Alcohol Action Ireland, found that it costs only €7.65 for Irish men to buy a week’s worth of alcohol, according to the Irish low-risk alcohol consumption guidelines. For women it is as low as €4.95.
The National Drug and Alcohol Survey findings, published by the Health Research Board (HRB) in July 2021 estimates that one in every seven Irish adults or 578,000 Irish people have an alcohol use disorder (AUD). Not increasing taxes on alcohol means these harms worsen as alcohol remains easily affordable.
Another contradiction in the decision to abandon the alcohol tax increase is that in the Budget speech Minister Donhue states that the government is focused on the higher levels of debt – which will come in at €240billion next year. But alcohol taxation is the most cost-effective, high impact measures recommended by the World Health Organization (WHO) to reduce alcohol harm and at the same time generate revenue for the government. By abandoning the increase in alcohol taxes the Irish government loses an opportunity for reducing the debt burden of the country by forgoing the domestic resource mobilization potential of alcohol taxes.
An infographic by Movendi International visualizes the vast and growing evidence that alcohol taxation holds massive potential for global health, for helping achieve the sustainable development goals and also for significantly contributing to financing health and development.
Ireland’s alcohol policy: Public Health (Alcohol) Act of 2018
Abandoning the alcohol tax increase in the Budget 2022 is also counter-productive to the advances in alcohol policy Ireland has made since the Public Health (Alcohol) Act was adopted into law in 2018.
Hopefully, some of the fallout from not increasing taxes can be managed by the minimum unit pricing (MUP) policy (section 11 of the Act) which is set to come into force in the country in January, 2022.
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 which are classified as over 18 and on children’s clothing.
- In November 2020, section 22 of the Act came into force which saw 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.
- Recently, in January 11, 2021 section 23 of the Act came into force. This saw 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.
Sources
The Irish Times: “Budget 2022: Minimal changes to income tax, price of alcohol unlikely to rise”
Irish Mirror: “What Budget 2022 means for alcohol prices in Irish pubs and Tesco“