Fine Gael has accused British chain stores with outlets here of blatantly "ripping off" Irish customers by charging much higher prices in the Republic than in the UK.
However, the stores have rejected the party's claims, with Tesco accusing Fine Gael of being "opportunistic" and making selective and misleading comparisons.
Fine Gael's deputy leader and finance spokesman, Mr Richard Bruton, yesterday published the outcome of a price survey of British high street stores showing dramatic price mark-ups in the Republic.
A random selection of five products in Tesco in Ireland was 43 per cent dearer on average than in Britain, the survey says. A similar number of products shows a 25 per cent higher price in Ireland at Habitat and an 18 per cent mark-up at Argos.
Prices at Dixons and Marks & Spencer, however, were virtually the same in both jurisdictions. Fine Gael says this shows that the usual reasons given concerning transport costs or higher business costs in Ireland do not stand up. "If two of the participants in our survey can offer Irish consumers the same prices as their UK customers, then the others should be able to follow suit," said Mr Bruton.
He suggested that this "blatant example of rip-off" should be tackled by UK multiples displaying both the UK and Irish prices of their products. "More than that, Irish customers should vote with their feet and take their business elsewhere if this type of opportunistic price rip-off continues."
A Fine Gael spokesman insisted that the items compared were chosen at random, the only criterion being that there had to be an identical item in Republic of Ireland and UK stores.
The most extreme price differential was found in relation to a packet of razor blades in Tesco which cost €4.28 in the UK, but €7.99 in the Republic, an 87 per cent difference. Other Tesco differentials include a packet of washing powder costing €5.45 in the UK but €8.49 here, a 56 per cent difference.
Habitat sold the same storage unit for €276 in the UK and €424 in the Republic, a 65 per cent increase. Argos sold the same hi-fi unit for €404.53 in the UK and €499.99 in the Republic, a 24 per cent difference.
However, Tesco and Habitat said other products were cheaper in Ireland than in the UK. Argos could not be contacted for comment.
Tesco claimed the survey was selective and misleading, and that the products compared in the Fine Gael survey were not representative of the store's prices in general. Razor blades were regularly discounted in UK stores which explained the price difference, while "everybody in the trade knows cheese [another of the products surveyed] is more expensive for stores to buy in Ireland than in the UK".
He acknowledged that Tesco prices in Ireland were more expensive than in UK stores, but said the differences were around 10 per cent rather than the 43 per cent found by Fine Gael.
The company blamed higher wage and transport costs, as well as higher taxes in Ireland for the difference. It also said supplier prices were generally higher in Ireland. "To rely on five selected and unidentified food items from a selection of 25,000 in any store is highly unrepresentative and misleading." The company said it compares the cost of 2,500 items each week with prices in other stores in Ireland where the same costs, economic conditions and taxes apply. These show that Dunnes Stores is on average 2 per cent dearer than Tesco, SuperValu is 5 per cent dearer, Spar 10-15 per cent dearer and Centra 20 per cent dearer on average.
"Who is doing the rip off here," the spokesman asked. "Why isn't Fine Gael looking at this?"
Habitat, accused of having prices 25 per cent higher in its Dublin store than in the UK, based on Fine Gael's survey of five items, immediately produced prices for five other items which were up to 43 per cent cheaper in Dublin than the UK.
Fine Gael in turn said that these prices given by Habitat differed from the prices in the store's brochure and website.
The general manager of the Dublin store, Mr John Adams, said the most obvious reason for price differences that do exist is that the VAT rate here is 21 per cent compared to 17.5 per cent in the UK.
In addition, much of the present stock was paid for in euro before the currency appreciated.
However, Fine Gael said Habitat prices in Ireland for its five items are 42 per cent dearer than in France which also uses the euro, so this point is "spurious".
Mr Adams said shipping costs across the Irish Sea were almost as expensive as bringing goods from Italy to Dublin and insurance and other costs were also higher here.
"I can buy The Irish Times in Belfast for 75p, but it costs me €1.50 in Dublin," he said.