The Drinks Industry Group of Ireland is calling for the government to introduce an immediate hospitality support package and a reduction in excise tax to support the recovery of the country’s pubs and bars.
The Drinks Industry Group of Ireland (DIGI) is an umbrella organisation representing a number of hospitality and drinks trade groups in the country.
Ireland’s pubs and bars were told to close in March to prevent the spread of the coronavirus. Since then, only on-trade outlets that serve food have been allowed to reopen, representing 40% of pubs in the country.
The DIGI said that if drinks-led venues do get the go ahead to reopen on 13 September, which is yet to be confirmed, then these venues would have been closed for half a year. The organisation said there is “growing fear” among pub and bar owners that their sites will remain closed until 2021.
The DIGI noted that 13 EU member states have permitted the on-trade to reopen, while in England, pubs and bars reopened on 4 July.
Rosemary Garth, chair of the DIGI and director of communications and corporate affairs at Irish Distillers, said: “Irish pubs have endured the longest lockdown in the EU, losing half a year of business.
“The government has so far failed to provide them with any kind of reassurance, certainty, or long-term support. For many publicans, the situation seems hopeless, and it is little surprise that in a recent industry survey as many as 63% said they had been under extreme stress. Many expect to be closed.”
The DIGI said the Irish hospitality sector has received no industry-specific support from the government and there is no sign that any help will be imminent.
As such, the DIGI is calling for an immediate support package to help drinks and hospitality business owners and a 15% cut to excise tax on alcohol in the budget 2021. Ireland has the second highest overall excise tax on alcohol in the EU and the third highest on spirits.
Immediate financial support needed
Garth said government support in 2021 will be too late and the “damage will have been done”.
She said: “The drinks and hospitality sector needs financial support now, and, in addition, this budget should also provide an alcohol excise tax reduction. Without it, pubs will reopen with the second highest excise tax in the EU and we risk permanently losing hundreds of businesses and thousands of jobs, just as we did in the 2008 recession.”
The move to cut excise tax will help venues recover from the six-month closure, regain some money spent on personal protective equipment, and cover the losses of operating at reduced capacity for the foreseeable future, the DIGI said.
In addition, the reduction would help distillery startups and breweries.
Ireland’s drinks industry directly employs more than 90,000 people. In 2018, the industry exported €1.4 billion (US$1.65bn) worth of products.
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Author: Nicola Carruthers