"Rural pubs are facing an existential crisis", says Kilkenny drinks chief

The Vintners Federation of Ireland (VFI) have called for a 40% rebate on the excise charged to draught products sold in pubs.

The VFI says the rebate would help protect rural pubs that play a vital social role in their local communities, while also preserving employment in a sector struggling with soaring costs.

Ireland has the second-highest excise rate on alcohol in Europe, with taxes accounting for nearly 30% of the price of a pint. According to the VFI, the current tax burden is unsustainable and is placing severe financial pressure on publicans, particularly in rural areas.

“Publicans are not asking for a handout – we are asking for fairness,” says VFI CEO Pat Crotty. “A 40% rebate on the excise charged on draught products is a practical, targeted support that would make a real difference for small pubs across Ireland. These are businesses at the heart of their communities, providing employment, social connection and play a key role in our tourism offering.”

Pat continues, “We welcome the Government’s commitment to support SMEs in the Programme for Government, which acknowledges the increased cost pressures on the hospitality sector. However, it is vital that any measures introduced benefit all pubs – not just those serving food.”

The VFI argues that while the proposed VAT reduction for hospitality is welcome, it will only benefit pubs that serve food, leaving traditional pubs without support. The draught rebate, in contrast, would ensure that all pubs, regardless of size or location, benefit.

“Rural pubs are facing an existential crisis,” adds Pat. “We have seen hundreds of pubs close their doors in recent years. If this trend continues, we will lose a vital part of Irish culture and community life. A draught rebate is a simple, fair, and targeted measure that would provide immediate relief. We estimate the rebate would cost €73m annually, a small fraction of the VAT proposal.”

The VFI is urging the Government to include the draught rebate in the upcoming Budget as a critical measure to preserve Ireland’s pub culture and sustain rural communities.