Madam, - Truly the silly season must be approaching if your publication (June 25th) of the letter by Dan Walsh with the heading "Expensive Ireland" is any indication.
Mr Walsh complained that he paid €6.49 for a copy of Golf Monthly, despite it having a printed sterling recommended retail price (RRP) of £3.70. He suggests that the newsagent made a mark-up of 24 per cent over and above the conversion from sterling to euro.
Magazines that have originated from the UK have no fewer than three variations from the printed sterling price that must be applied to them before they are sold in any of our shops.
The first is the sterling to euro conversion; the rate Mr Walsh quoted, 67p to €1, was the approximate rate used for the three-month period May-July by our distributors, but a note of caution should be inserted here; there can be occasions when currency fluctuations can seem to provide better or worse conversions if one was relying upon the daily published exchange rates. The distributors buy their currency forward, and price the products for the three-month period regardless of daily changes.
This has the effect of price stability on issues that range from weekly to quarterly publication frequency. In the case of which Mr Walsh complained, £3.70 converts to €5.52 (not, as suggested, €5.22).
Secondly, the product that Mr Walsh referred to needs to be shipped from the printers in the UK to Ireland. Additional costs, specific to this island destination, are recouped using a formula approved by the Department of Enterprise for many years. A carriage charge of 5 per cent is added to the wholesale cost of the product by the distributor to achieve parity with their UK counterparts, prior to selling to our members. In the instance to which Mr Walsh refers, an additional 20 cent should be applied to the product.
The third part of the equation is completed when the VAT, in this case set at 13.5 per cent, is added, putting a further 77 cent on to the price, now costing the figure of €6.49 that Mr Walsh complained of.
If I may be permitted to make a few comments upon this topic, which seems to arise at least once a year in different guises.
The translation of any product manufactured and sold in the UK for a known or printed price,without allowing for different economies of scale, transportation charges and fiscal (VAT/excises, etc) reasons will inevitably lead to a knee-jerk "rip-off merchant" charge being levelled against the retailer. We provide quality service, seven days a week, in what is most likely the most competitive commercial environment in Ireland. Many of our members have invested substantial amounts of their own funds to ensure that their customers are provided with the best available products,served by a workforce that is in excess of 50,000 people. We neither seek, nor wish for, Government grants or handouts, but would expect that our contribution to the economy is not subjected to ill-informed suppositions that perhaps have more to do with "begrudgery" than meaningful comment.
If any valid complaint relating to the price of our newspapers and magazines could be sustained, it is with the continuous refusal by the Department of Finance to remove the tax on information that causes either 13.5 per cent or 21 per cent to be added to these vital resources to learning. I for one cannot see a justification in adding a substantial amount of money to a children's educational magazine, placing it on the same tax footing as a bar of chocolate. I also fail to see the tax logic in not applying VAT on books, but subjecting a newspaper or magazine that have the same intellectual stimulation to this retrograde fiscal policy. The Convenience Stores and Newsagents' Association would welcome a declaration from any and/or all of our public representatives that would support the removal of VAT from newspapers and magazines.
Finally, Madam Editor, it is obvious that the sterling price of a paper is not always the sole indicator of the value we as a society place upon it. How else could we explain the comfort we feel in paying €1.60 for today's Irish Times(VAT included), whilst those in the UK are relieved of a mere 80 pence? The sterling equivalent ex-VAT of the Irish version is £1.06, but I suppose it has the attraction of being available in all of our shops without complicated formulae having to be explained to all and sundry. - Yours, etc,
VINCENT JENNINGS,
CEO, Convenience Stores and Newsagents' Association,
2, Priory Hall,
Stillorgan,
Co Dublin.