Friday 19 January 2018

Tax on alcopops and levy on off-licences to compensate for sport sponsorship void

Fionan Sheahan

A TAX on alcopops is being examined as a model for an alternative source of funding when the ban on alcohol sponsorship of sport comes into effect.

As the Government looks at what are known as social responsibility levies, a tax on off-licence sales is also on the table.

But the Department of Finance is objecting to a specific tax on alcohol being ringfenced as a substitute fund to replace drink sponsorship of sports events.

Ministers are thrashing out a deal to end alcohol sponsorship. The drink clampdown will also see a ban on below-cost selling of alcohol and restrictions on alcohol advertising.

No agreement was reached at a Cabinet sub-committee meeting last week. But the outline for a decision to be made in the next 12 months was set out.

A committee made up of the Departments of the Taoiseach, Finance, Health and Sport will examine the issue further. But a government source said the Department of Finance was opposed to a levy being ringfenced.

"There was resistance from the more powerful elements of Government," the source said.

The Department of Finance tends to avoid specific taxes being allocated for specific purposes, rather than going into a general pot.

Ministers are divided over the need for the ban and when it would come into effect amid concerns over the loss of funding for sports clubs and organisations.

The Government is trying to provide an alternative source of funding to the money provided by the alcohol companies.

To try to curb binge drinking, the Australian government slapped a 70pc tax increase on pre-mixed drinks – known as alcopops.

The Government will return to the issue in the autumn.

The ban on alcohol sponsorship will probably come into effect sometime near the end of the decade.

However, it was agreed the ban can't be put in place until an alternative fund is agreed.

"It's been made absolutely clear that there can be no consideration of a ban until such time as alternative funding has been identified and made available to sporting organisations," a coalition source said.

The Cabinet sub-committee met last Monday and agreed to the need for further analysis.

The move toward a ban on sponsorship can only happen with the agreement of the Ministers for Health and Sport.


"There are a number of very positive measures which would have a very beneficial effect in relation to alcohol consumption, in the areas of education, pricing, advertising and others. There is a strong desire to see these measures implemented sooner rather than later.

"Regarding sponsorship, there is a recognition that the issue is not really about a specific date. We need to first sort out where the alternative funding will come from, before we can get into that discussion," a government source said.

Irish Independent

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