Written Answers. - Excise Duty on Wine.

Austin Deasy

Question:

52 Mr. Deasy asked the Minister for Finance if he will remove excise duty on wine which is commercially produced in this country in view of the fact that the rate is quite excessive when compared with the level of such duty in EU countries where wine is produced traditionally. [8589/96]

We are bound by definitive harmonised EU rules for production, holding and movement of excisable goods in the Community and by harmonised EU rules governing the structure of excise duties and the minimum rates which member states must apply in particular on tobacco, hydrocarbons and alcoholic drinks.

It would not be possible under EU law to accede to the Deputy's requsst to remove excise duty on the negligible amount of wine produced in the country without also reducing the excise duty on all wine imported into the State. While it would be theoretically possible to introduce a zero rate of duty for all wine sold in Ireland, such an excise reduction would favour in the main, a non-domestically produced product. It would result in turn in significant pressure to reduce the excise duty on beer and spirits, which are domestically produced alcoholic drinks. I am not prepared to do this, not least because it would have significant negative effects on Exchequer revenue from alcohol amounting to several hundred million pounds. The Exchequer receipts from wine alone in 1995 were £49 million, or 10 per cent of total excise revenue from beer, wine and spirits together.