Irish Tax Will Lead To Smuggling

September 4, 2017 Taxation in Ireland

Soda TaxDUBLIN – Ireland would be opening the door to smuggling if it introduces a tax on soda.

Late last week the Irish Beverage Council, an industry advocacy group operating in Ireland, states that tax authorities would see a significant loss of revenues if the government enacted a tax on sugary beverages next year, as is currently planned.

The group claimed that if the tax on sugary-sweetened beverages is enacted, then consumers will begin sourcing a portion of their drinks from Northern Ireland, which will foster the creation of a grey-market for such drinks.

It is estimated that the tax would result in an 11 percent loss in sales due to smuggling.

The loss in sales would equate to an EUR 30 million loss in retailer sales, and a proportionate loss in tax revenues.

In comparison, the tax itself would only raise EUR 40 million in new revenues.