Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

This amendment concerns the 50% excise relief for qualifying microbreweries, which works out at about 27 cent per pint. The amendment proposes to increase the production ceiling from 40,000 hectolitres to 60,000 hectolitres. The current production ceiling is 40,000 hectolitres and the claim ceiling is 30,000 hectolitres. By way of illustration, 40,000 hectolitres is equivalent to 7 million pints or 12 million 330 ml bottles, so it is a very significant amount of production. In fact, where two or more microbreweries operate in conjunction, the scheme allows that they may produce up to 80,000 hectolitres, claiming excise relief on up to 60,000 hectolitres. This enables small breweries to work together and produce larger amounts while still qualifying for the relief.

I am informed that increasing the production ceiling as proposed would benefit a very small number of local microbreweries in the near term. It may benefit microbreweries located elsewhere in the EU which are equally entitled to claim the microbreweries relief for produce sold in Ireland, which is a very important point. The proportion of relief claimed by microbrewers and claimants outside the State increased from 1.4% in 2016 to 8.5% in 2017. An increase in the production ceiling to 60,000 hectolitres would likely further encourage non-Irish microbreweries to avail of the relief and potentially compete in the Irish market.

My Department has not been approached about this proposed change. I understand the companies supporting it are at the largest end of production. If we were to bring in this change, it would mean that microbreweries located elsewhere in the EU would benefit provided their products are sold in Ireland. There is already a very significant relief in place, amounting to 27 cent per pint.

While I am willing to consider the proposal, I will not give a definite commitment to change it at this point. That it has not been the subject of broad representations to me gives me food for thought. Moreover, the benefit would be confined to the larger craft microbreweries and the measure would have a neutral effect elsewhere. The benefit would also accrue to larger breweries located outside Ireland. These factors make me wonder whether it is a change worth making. I am not rejecting it out of hand now because I have great respect for what has happened in craft brewing in Ireland. While I no longer classify myself as a young tourist, or even a particularly young citizen, the development of this industry is a credit to everyone involved in it. Whether one is a tourist or a citizen, the industry has brought great enjoyment to those who have sampled the products brewed here. It is an important area of innovation in Irish food and drink. That is the spirit in which I view the development of the industry.

The facts that my Department was not approached on this matter in the run-up to the budget and that the measure is focused on large companies gives me pause. I will consider this matter before Report Stage but I want to carefully examine who would benefit from it.