The tax take in Ireland from alcohol and cigarettes could be severely affected by a European Court of Justice (ECJ) ruling due next week.
The court is expected to rule that when goods are purchased in an EU country and delivered to another member state, only the duty levied in the country of origin would be due.
A test case had been taken to Europe by a Dutch group that had imported wine from France but was levied alcohol duty by the Dutch government. The company challenged that decision to the ECJ and the court's advocate general, Francis Jacob, found the Dutch government had been wrong to do so.
A full court decision is expected on November 23rd. The ECJ follows the advocate general's opinion in about 80 per cent of cases.
President of the Irish Taxation Institute Dermot O'Brien said last night that the ruling would have major implications for those framing the budget here. He said the last full annual figures available on excise take were for 2004, when the figure was just over €5 billion. Of this, excise from tobacco was €1.05 billion and from alcohol €1.022 billion.
"Any change in the levels of revenue from these areas must have a major impact on how a budget is framed and on decisions such as stamp duty or other areas which may be altered," he said.