As businesses face the most critical budget in recent history, the Vintners Federation of Ireland (VFI) is calling on the Government to urgently address the severe challenges facing the pub industry. Without targeted support measures in the upcoming Budget on October 1st, many well-run pubs across the country risk closure, leaving a lasting impact on communities and the economy.

The escalating costs of running a pub have reached unsustainable levels, with publicans struggling to break even, let alone turn a profit. Rising labour costs, the increase in energy and water bills along with some of Europe’s most punitive taxes have created a perfect storm, threatening the survival of an essential part of Irish social life.

Pat Crotty, Chief Executive of the VFI, warns of the grave situation: “The pub trade in Ireland is at a breaking point. Without meaningful government intervention, we will see a wave of closures that will impact communities across the country. Publicans need long-term support, not just one-off schemes, to navigate these unprecedented challenges.”

In an effort to highlight soaring costs, the VFI has designed a poster explaining where the money goes after a pint is purchased. “The Government takes €1.77 from every pint sold,” explains the VFI CEO. “The drink supplier receives over €1.50 while staff costs account for €1.41. By the time overheads like insurance and TV sports subscriptions are paid the typical publican is left with just 17c. The average publican doesn’t come close to selling enough pints to make it a profitable business.”

To ensure the survival of Ireland’s pubs, the VFI is demanding the following measures be introduced in the upcoming Budget:

1. Reduction of 7.5% in Excise Duty: This will provide immediate relief to publicans, allowing them to reduce prices and increase margins, which are currently squeezed to unsustainable levels.
2. Lower Hospitality VAT Rate to 9%: For pubs serving food, a reduced VAT rate is essential to maintaining affordability for customers while enabling publicans to remain competitive.
3. Reduction in Employer’s PRSI: The high cost of labour is the most significant burden on publicans. A reduction in Employer’s PRSI will help to alleviate this pressure, allowing publicans to retain staff and manage their wage bills more effectively.
4. Pause the move to a Living Wage: While the VFI supports fair wages for all employees, the move to a Living Wage must be paused until a full impact assessment on the pub trade is conducted. The current economic climate does not allow for such a significant increase in labour costs without risking widespread job losses and business closures.
5. Lower High VAT Rate from 23% to 21%: A reduction in the standard VAT rate will help reduce overall operational costs for publicans, making the business more sustainable in the long term.

“The Government must recognise that pubs are more than just businesses—they are the heart of communities, providing social hubs and supporting local economies,” says Pat Crotty. “We need a clear commitment from the Government that they understand the scale of the crisis facing our industry and will take decisive action to prevent the collapse of our cherished pub culture.”

The VFI urges the Government to consider these demands seriously and implement the necessary measures to ensure the survival and prosperity of the pub trade. Without these supports, the future of many well-loved pubs across the country hangs in the balance.

‘No Profit in Pints’ poster is available for download here