Drinks trade pleads for tax cut
The Government is being asked to cut tax on drinks in an attempt to stem the dramatic plunge in the pub trade.
The Drinks Industry Group of Ireland (Digi) said the proposed 2% VAT hike will squeeze bar-owners even tighter at a time when they are facing "meltdown".
The group, which represents manufacturers as well as traders, has called for a 10% drop in excise duty on alcohol.
Donall O'Keeffe, Digi secretary and chief executive of the Licensed Vintners Association, warned the VAT increase without any off-setting measures will cost more jobs.
"This will inevitably lead to price increases and will act as a major disincentive to consumers to socialise and spend money in the hospitality sector," he said.
"It will exacerbate the severe difficulties being experienced by the on-trade in particular."
Mr O'Keeffe said Ireland already has very high alcohol taxes by EU standards and urged a 10% reduction in excise.
Sales at bars have plummeted by almost a third in the past four years, with the off-licence trade also recording a drop-off.
Almost 38,000 jobs have been lost, according to Mr O'Keeffe.
"The year-on-year losses we have experienced since the start of the economic downturn are being aggravated by the fact that consumer confidence is at rock bottom," he said.
"In the current climate, that is entirely understandable.
"But for jobs and businesses in the hospitality sector it is a nightmare scenario."