Dáil Éireann debate -
Wednesday, 15 Jan 1975

Vol. 277 No. 2

Financial Resolutions. - Financial Resolution No. 4: Customs and Excise—Wine.

Minister for Finance (Mr. R. Ryan)

I move:

(1) That the duty of customs on wine imported into the State imposed by section 39 of the Finance Act, 1969 (No. 21 of 1969), as amended by paragraphs 7 and 8 of the Imposition of Duties (No. 213) (Customs Duties and Form of Customs Tariff) Order, 1974 (S.I. No. 174 of 1974), shall, as on and from the 16th day of January, 1975, be varied by the addition of the sum of £0.562 to each of the rates of such duty chargeable immediately before that date.

(2) That the duty of excise on Irish wine imposed by section 15 of the Finance Act, 1966 (No. 17 of 1966), shall, as on and from the 16th day of January, 1975, be varied by the addition of the sum of £0.562 to each of the rates of such duty chargeable immediately before that date.

(3) It is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1927).

Mr. Brennan

Most people have not much sympathy with wine drinkers as such, but there are a few questions I would like to ask the Minister before we deal with this resolution. Does it include altar wine?

Mr. R. Ryan

I would say yes. It is not distinguishable.

Mr. Brennan

I would also like to know what quantity of wine may one produce on ones own part without having to pay excise duty? Home-made wine has become quite a popular thing. What is the limit?

Mr. R. Ryan

The Deputy has asked me a question which does not directly relate to this resolution. I am not in a position to answer it, but I would share his curiosity to find out. I would say there is probably a limit to home consumption. It has to be consumed at home because if it were not consumed at home, then it would become liable to duty.

Mr. Colley

Subject to that, surely there is no limit.

Mr. R. Ryan

I am not aware of any.

Mr. Brennan

The only thing I see wrong with the tax of 10p on wine is the fact that table wine is the cheapest intoxicating drink now available, and it was becoming rather generally consumed. It is used by many people as a substitute for stronger spirits. To put it out of bounds by putting up the price is a pity. The Minister should have allowed some particular drink that would not be too expensive, not a strong alcoholic drink necessarily. No one has much sympathy with those who can afford to drink expensive wines and champagnes. I shall not mention any names, but there is a rather popular drink on certain occasions. There are many people for whom spirits and alcoholic drinks generally are beyond their incomes; they will be even more so in future. I am reminded that a glass of brandy and a bottle of lemonade will in future cost £1.

Mr. Coogan

£4 million a week.

Mr. Haughey

Does this duty cover all kinds of wines, sparkling wines, still wines, fortified wines, or are there any categories exempt? This seems to be a flat type of duty. It will be 10p on the bottle of champagne and it will be 10p on the bottle of wine costing £1. Would it not be more desirable to have an ad valorem duty, a tax graduated to the cost rather than a flat 10p per bottle irrespective of cost?

Mr. R. Ryan

The wine tax has always been a specific tax, not an ad valorem tax. I can see the argument in favour of an ad valorem tax, a tax related to the price of the wine. Earlier Deputy Haughey was arguing in favour of a heavier duty on imported liquid assets.

Mr. Haughey

This is all imported.

Mr. R. Ryan

There is a good deal to be said for this particular duty on the imported product. It cannot be said to have repercussions on employment, certainly not to the same extent that other duties might have on some home produced items.

Mr. Haughey

Does the Minister not agree it is quite farcical to put 10p on a bottle of champagne costing £6 and 10p on a bottle of wine costing 50p? Would it not have been better for him to have exercised himself a little more and made this an ad valorem duty?

Mr. R. Ryan

Efforts are being made in the EEC to have a common structure for all duties on intoxicating liquors. I expect that the wine duty structure when the discussions are completed will be somewhat similar to what Deputy Haughey suggests. In the interim we are proceeding on the same basis as that which operated in the past. As I say, I do not think this is the end of it.

Mr. Haughey

The Minister took the lazy man's way out.

Mr. R. Ryan

No. There are major dangers because we are in the middle of negotiations and it is better to leave things as they are more or less until those negotiations are completed.

Question put and agreed to.