The Vintners’ Federation of Ireland (VFI) is urging the government to introduce a draught rebate scheme in next month’s (October) budget, describing it as a vital lifeline for rural pubs most at risk of closure.

According to the VFI, the scheme, capped at €20,000 per pub, would return 40% of excise duty on draught beer and cider, at an annual cost of €73 million.

It said that the majority of funds would flow directly to the smaller, traditional pubs that "form the backbone" of community life across rural Ireland.

The chief executive of the VFI, Pat Crotty said: "If government fails to act, Budget 2026 will be remembered as the year rural pubs were abandoned.

"The draught rebate is the difference between survival and closure for thousands of small pubs that keep communities alive.

"This scheme is designed to help the pubs that need it most. Traditional drink-only pubs are excluded from the proposed 9% hospitality VAT rate and are battling soaring costs, from government-driven payroll increases to insurance, energy and supply hikes" he added.

Crotty believes that without government intervention, many of small rural pubs will not survive.

The VFI pointed out that a typical rural pub, selling around 245 kegs a year, would receive a rebate worth €4,00 annually, delivered through the VAT system.

Alongside the rebate, the VFI is also calling for the reinstatement of the 9% VAT rate for food services, to ease the burden on food-led pubs that have struggled since VAT was increased by 50% in 2023.

Crotty said: "This is about fairness and survival. The draught rebate is simple, capped and targeted. It will mean the difference between survival and closure for countless rural pubs.

"Government must act decisively on Budget day," he added.

Without urgent action, the VFI has warned that Ireland risks losing hundreds of pubs that "underpin social and economic life" in rural towns and villages.