The Government should cut tax on alcohol in order to save pubs, an economist has urged. 

Since 2005, 2,054 pubs have closed in Ireland - most of which were located in rural areas - have shut, according to new research by the Drinks Industry Group of Ireland.

It means one in four of all Ireland’s pubs have shut down in the past two decades - or 112 on average every single year. 

On Newstalk Breakfast, DCU Associate Professor of Economics Tony Foley said it was “not just one thing” driving the change. 

“I suppose the bottom line in any commercial enterprise is that it only operates if it makes a profit, if it makes a living,” he explained. 

“A lot of these pubs are not making a living in the present regulatory, taxation regime that exists. 

“So, if it’s not making a profit, it’s not going to survive.” 

A party of four clink glasses. Picture by: Alamy.com. 

Professor Foley continued that pubs are not the only victim of a “big exodus of services from rural areas”, with post offices, small shops and even Garda Stations all shutting down and relocating to nearby towns. 

Changing consumer demands, he believes, are another factor. 

“Maybe consumers now want a full range of craft beers in the local pub and a local operation can’t provide that range of products and so on,” he said. 

“Maybe they want good quality and the operation is too small to do so.” 

A couple of pints of beer in the sunlight on a pub table. Picture by: Alamy.com. 

Professor Foley added that Irish society now needs to decide if it cares enough to do something about the high rate of closure. 

If it does want to stop the “hemorrhage”, then he believes there are a number of things that can be done. 

“There are certainly ways of reducing the rate of closure,” he argued. 

“We have a very high tax in Ireland on the rate of alcohol - very high by European standards.  

“In the past, we might have said we went crazy drinking and so on - but our average consumption now is much lower than it was before. 

“It’s comparable to other countries; it’s lower than other European countries in some respects. 

“So, one thing would be if the Government takes less of what the public [pays for a drink], the publican keeps more of it and finds it more easy to operate the business. 

“It’s not going to be the panacea that eliminates all the problems.” 

Main image: Pints outside a County Clare pub. Image: Paul Quayle/Alamy