The Department of Finance has said it is up to its minister in the budget to decide whether or not to address concerns over millions of euro being returned to supermarkets for selling below-cost alcohol.
The remarks come after a TD and groups urged the Government to close off a legal loophole which allows retailers to reclaim a Vat refund on the difference between the cost price and the actual below-cost sale price.
Fine Gael TD Michael Creed reiterated comments yesterday that the exchequer was “raped on an annual basis to the tune of €21m” refunding supermarkets.
The taxpayer was effectively paying a subsidy to large supermarkets to promote cheap alcohol, he claimed.
“It’s simple: At a stroke of a pen by reintroducing the Groceries Order specifically for the purpose of banning the sales of below-cost alcohol, we could address this issue in another way and in a fully legal way,” said Mr Creed.
The Cork North West TD said that, under the current system, a retailer may buy a beer for €1 and sell it for 50 cent but only end up paying Vat on the 50 cent sell-on.
Source: Juno McEnroe, Irish Examiner, 07/10/14
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