Sir, – While there is much in Mark Paul's article "Excise cuts are best for big business, not local pubs" (September 19th) that we agree with, we feel that it is important to emphasise the reasons why an excise cut would be good for small businesses such as ours and why supporting an excise reversal is indeed supporting your local pub.
Government tax policy has imposed 28 cent on the average pint in three budgets – of which excise increases have been the key driver. As publicans, we have had no choice but to pass on these excise increases to our customers. In contrast, the large multiples can absorb these tax increases by spreading it over their product offer. This is causing a further widening of the price of alcohol in supermarkets versus in pubs.
Consider the cost of alcohol sold in supermarkets. Take for example last St Patrick’s Day, when a slab of beer – 24 cans – was available for €24. It is being sold as a loss leader. The same quantity of the same beer was €38 when sold on promotion in 2005.
Local pubs such as ours simply cannot compete with these kind of prices and this, along with the cultural shifts to which Mr Paul refers, encourages people to consume alcohol at home. Furthermore, the reality is that the cost of a meaningful VAT reduction would be prohibitive for the exchequer, whereas excise applies specifically to alcohol. The consecutive excise increases were an additional extra burden on our sector when compared to other small businesses around the country, as they targeted our sector and our sector alone. Conversely, an excise reduction would have a positive impact on the pub sector.
Finally, the reality is that excise increases have impacted on our cost of doing business. Excise impacts on margins, profitability and the sustainability of small businesses such as ours. This is why we are urging the people that enjoy socialising in our pubs and those of our members to support jobs, support their local and join us in our call on the Government to cut excise. – Yours, etc,
NOREEN O’SULLIVAN,
President,
Vintners’ Federation
of Ireland,
Rocky’s Bar,
Nenagh, Co Tipperary;
JOHN NEALON,
Chairman,
Licensed Vintners’
Association,
Blue Café Bar, Skerries,
Co Dublin.