Special Committee on the Finance Bill, 1992 debate -
Tuesday, 12 May 1992

SECTION 86.

Mr. Quinn

I move amendment No. 79:

In page 117, subsection (1) (a), line 28, to delete "0.5% and substitute "1.0%".

I have put down this amendment but it is in line with the sentiments — if I understood him correctly — the Minister is proposing. There is a desire to encourage consumption of low alcohol beer from a health point of view, but the price of the low alcohol beers available at present would not encourage this. In view of the overall desirability to promote low alcohol beer I wonder if the exemption to 1 per cent of alcoholic content as distinct from 0.5 would not meet with more approval. I put down this amendment, to change "not exceeding 0.5 volume" to "not exceeding 1 per cent volume" which is the point Deputy Noonan was making. Has the Minister had an opportunity to consider this and see if there is any merit in giving that threshold a little extra punch?

Mr. Noonan (Limerick East)

What about the substitute beers as we call them, the kalibers and so on?

Mr. B. Ahern

Point one.

Mr. Quinn

They are all under five.

Mr. B. Ahern

The 0.5 per cent threshold is adequate to ensure that non-alcoholic drinks, such as Kaliber, which are seen as competing with table waters rather than beer, are treated for duty purposes not as beer but at a special rate which is close to the duty on table water. This equality of treatment will be maintained in the Internal Market when the duty on table water will be abolished and beer, up to the strength of 0.5 per cent, will not incur duty. Moving the threshold to 1 per cent would cut across the EC proposals in this area. It would also exempt from duty certain low alcoholic beers on the market at the moment and thus give rise to a loss of revenue. Furthermore, in regard to the Deputy's concern is relation to the burden of taxation on beers between 0.5 per cent and 1 per cent, the rate of duty to apply to beer is graded by reference to strength. Lower strength products will automatically benefit in this way, while beer just above 0.5 per cent would be subject to duty at only one-eighth of the level of duty applying to a beer of 4 per cent alcohol strength. The duty is decided having regard to the strength of the beer. Therefore, if the beer is of 0.6 or 0.7 per cent volume, the duty would be decided on a pro rata basis.

Mr. Quinn

I know the House is being televised and I do not want to give free advertising to anybody, but will the Minister list the alcoholic strength of Tennents, for example, which is a low alcohol beer?

Mr. B. Ahern

Tennents is 1 per cent, alcohol volume.

Mr. Quinn

It is the lightest in terms of alcohol volume, while Budweiser would be fairly strong. The purpose in part of my amendment was to see if we could encourage by way of excise duty greater consumption of low alcohol beer. There is a health dimension to this as well as the driving aspect.

Mr. B. Ahern

I see the Deputy's point but my interest is in protecting the known beers. I agree with the Deputy's views on the alcohol strengths, given that the price is the same as for full strength beers.

Mr. Noonan (Limerick East)

The home brewer is exempt, is there any volume restriction on that?

Mr. B. Ahern

No, once it is for one's own domestic use.

Amendment, by leave, withdrawn.

Section 86 agreed to.