Alcohol Action Ireland press release, Monday, 1 September, 2025
Alcohol Action Ireland (AAI), the national independent advocate to reduce alcohol harm, is disappointed but not surprised by Drinks Industry Group of Ireland’s recent calls for government to reduce alcohol excise duties in the next Budget, showing once again that the massively profitable industry values lining their shareholders’ pockets more than the lives and wellbeing of ordinary Irish people.
Excise duties on products such as alcohol and tobacco exist because these are no ordinary products. Taxes serve a dual purpose of raising funding for the state which carries the burden of their harms and in helping to change price-sensitive behaviours. However, in recent years the government has taken very different courses of action around these two health-harming products, with regular increases in tobacco excise duties but no increases for alcohol since 2014, so their public health value continues to be eroded by inflation and are now at least 15% lower in real terms. Concerningly the amount of excise duty as a proportion of total tax take is going down –– from 2.8% of net receipts in 2014, to 1.1% in 2024.
In its Pre-Budget Submission, AAI is calling for an increase in alcohol excise duties by at least 15% and that going forward it should be automatically linked to the Consumer Price Index.
AAI CEO Dr Sheila Gilheany said: “Alcohol carries a significant financial burden to the state in terms of health care, criminal justice and loss of workplace productivity. The World Health Organisation conservatively estimate these costs in the region of 2.5% of GDP annually – that’s around €14 billion for 2024. Alcohol duties only bring in a small fraction of the costs at just €1.2 billion annually. The alcohol industry argues that their product also brings in VAT and other taxes, but this ignores the fact that all businesses pay these taxes without their products putting 1,500 people in hospital every day. Shop bought alcohol is actually 85% more affordable today than it was in 2004 and even in pubs it is 15% more affordable.
“While alcohol consumed per capita annually is showing some welcome reductions from historic highs, partly as a result of public health measures such as those contained in the Public Health (Alcohol) Act, as a nation we are drinking 35% above the current HSE lower-risk drinking guidelines. In addition, our binge drinking rates have shown a worrying increase in the past year – Ireland ranks 8th across OECD countries for this dangerous drinking pattern. Meanwhile youth drinking, which had been showing a decline over the past two decades, is actually inching upwards again.
“Despite these facts, the alcohol industry continually demands that excise duties be slashed – this is in addition to demanding bespoke VAT reductions. Their argument in relation to excise is that Ireland has high rates by comparison to other EU states. However, excise duties in a high-income country like Ireland reflect the specific harmful nature of alcohol to the state. Moreover, let there be no doubt that the industry’s self-serving arguments are about profit maximation, and nothing more. Indeed, we saw this recently with their campaign to derail Ireland’s alcohol health information labelling. In relation to taxes and duties, industry engages in selective comparisons to European peers, always advocating a downrating; for example, to date they have not sought an uprating of corporation tax to the European average.”
Beyond alcohol duties there is also a need to consider other ways to ensure that the alcohol industry pays for the harm caused by its products. AAI is calling on government to:
- develop a new ‘polluter pays’ alcohol levy system, with funding raised to be ringfenced for alcohol harm reduction strategies
- introduce a mechanism for automatic uprating of Minimum Unit Pricing in line with inflation otherwise it will lose its public health value
- advertising or marketing of alcohol should not be provided with tax relief
- provide funding to the HSE to develop its own trauma-informed treatment services, as well as funding Alcohol Care Teams within all major hospitals
- provide dedicated funding to give the national Hidden Harm framework – that recognises the adverse childhood experience of growing up with parental problem substance use – momentum and urgency
- provide immediate top-up funding for youth mental health services and initiatives
Dr Gilheany continued: “The reality is measures must be implemented to help curb the still high levels of alcohol consumption in Ireland, and taxes must also be paid to deal with the harmful fallout of drinking. Cutting excise only serves the alcohol industry and it means others will have to pick up the tab for alcohol harm – such as ordinary workers through increased income tax. AAI believes that the alcohol industry should pay for the harm their product causes.
“As things stand it is the ordinary taxpayer who is left to pay the billions-of-euros cost of alcohol harms while the industry continues to record massive profits. This is totally unfair and unjustified. AAI is calling on Minister for Health Jennifer Carroll MacNeill to seek at least a 15% increase in alcohol excise duties in Budget 2026, considering alcohol harm costs an estimated 11% of her department’s annual budget, and that going forward their levels are linked automatically to the Consumer Price Index. Unlike tobacco, which sees annual increases in excise duties, alcohol excise duties have not been increased in 11 years. It’s time for government to stop giving industry a free pass on the harm its product causes.”
ENDS
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