Government faces industry resistance to ‘latte tax’ – The Irish Times

Government plans to impose so-called ‘latte tax’ of at least 20 cents on disposable paper coffee cups, before banning them altogether, faces campaign of resistance from shop owners cafes, cup makers and industry lobby groups, who claim it will hurt business and be counterproductive for the environment.

The tax is one of several environmental measures in the government’s Circular Economy Bill, which has been approved by Cabinet and is expected to become law before the end of the year. Single-use paper coffee cups, which usually also contain a small portion of plastic, will be banned for customers in sit-down cafes. The fee will initially be set at 20 cents for takeaway coffees, but could theoretically rise to €1 per drink under the law.

The law will affect thousands of cafes across the state, as well as retailers, garages and other businesses that sell hot beverages. It will also increase costs for customers – Ireland has one of the fastest growing takeaway coffee cultures in Europe, with more coffee shops per capita in Dublin than any city on the mainland bar Amsterdam, according to a industry study.

Green Party TD Ossian Smyth, the Minister of State for Plans, has confirmed that the Government’s plan is to ban paper coffee cups altogether, and that the tax is only an interim measure to bring people to “change their behavior”.

The government wants all cafe customers to switch to reusable plastic cups instead. This would mean that customers such as office workers and others who typically buy coffee on the go would need to carry a clean coffee cup with them to hand over to be refilled in store each time.

Some cafe owners are concerned that handling customers’ reusable cups could be unsanitary for staff – storage cups have been banned by many stores during the pandemic due to infection fears. They say their outlets’ energy and water consumption and staff workload will also increase if customers don’t keep cups properly clean and have to be washed at the counter first.

Some cup makers, whose trade is threatened by the bill, have also argued with the government that the disposable tax does not take into account the composition of the cup and that it should be lowered for cups containing less plastic. Cup Print, a 200-employee Ennis company that makes recyclable and compostable paper cups, recently made a presentation to members of a sub-committee of the Oireachtas Joint Committee on Environment and Action for the climate, which examines the proposals.

He presented politicians with a report by Danish engineering consultancy Ramboll which concluded that switching to hard plastic cups would result in the use of 3.6 times more water and 2.8 times more carbon compared to compostable paper cups.

Terry Fox, founder and chief executive of Cup Print, said 60% of his stock was exported and unaffected by the ban. But he said an outright ban on reusable cups would be ‘catastrophic’ for Irish coffee sales, as many customers might simply not bother buying a hot drink if they weren’t wearing a cup.

He also said the proposals as currently designed could lead to increased plastic consumption through repeated purchases of harder cups and a “worse outcome for the environment”.

Mr Smyth argued that the vast majority of recyclable or compostable cups are simply thrown away by customers anyway, and that 200 million of them end up in landfill each year.

Karl Purdy, the founder of the Coffeeangel chain, which has five outlets in Dublin, says he agrees with the bill’s aim to reduce environmental waste. But, he says, the tax and the ban should be delayed until more studies have been carried out into the implications for the health and safety of staff who would end up handling hundreds of cups every day washed by customers.

“The civic infrastructure in Ireland is not good enough for recycling and composting,” he said, adding that if it were improved there would be less waste.

Coffeeangel’s canned coffee sales reached 6.5% of total coffee cup sales in 2019. Mr Purdy said there was a “willingness to do the right thing” in the industry, but that the proposals as currently framed would be harmful.

Duncan Graham, chief executive of lobby group Retail Excellence, which has several cafe chains among its members, said he would write to the government next week asking that the tax and future ban be delayed until the measures have been ‘better thought out’.