ACCORDING to the Licenced Vintners Association, ‘a reduction in the hospitality VAT rate is not enough. It needs to be extended to alcohol as this is the only measure that will support the pubs closed for months.’
The LVA, the Vintners Federation of Ireland and Drinks Ireland are calling for a temporary reduction in the hospitality VAT rate and extending it to apply to alcohol sales in the on-trade (pubs, restaurants and hotel bars) until December 31st, saying our current 23%, rate is ‘extremely high’ by EU standards.
Approximately one third of Dublin pubs have not re-opened, while outside of the capital, more than 60% of pubs remain closed as they do not serve food. They say the reduction in the VAT rate on alcohol is being sought to safeguard 22,500 jobs, dominated by large numbers of young workers, as pubs are on track for a projected 50% decline in business for the remainder of 2020, according to a report authored by DCU economist Anthony Foley.
However, Alcohol Action Ireland has justifiable fears that to reduce the cost of alcohol ‘would further fuel an already flaming public health crisis of alcohol harm’ and that consumers would still pay the same.