UK chancellor freezes alcohol duty accelerator

19 March, 2014

“While we welcome the announcement to cut beer duty, the Chancellor’s claim that this will help pubs is misplaced. 40% of the drinks sold in pubs are wine or spirits and the increased duty rates on these products will have a real impact on business.

“With the duty escalator now a thing of the past, the Government now needs to move forward and engage with business, creating policies that are good for jobs and the economy,” said Saunders.

CAMRA (The Campaign for Real Ale, the pressure group for lovers of genuine ale and great pubs) chief executive Mike Benner, said:

“CAMRA is delighted to see the Chancellor implementing an unprecedented second consecutive cut of a penny in beer duty. This is not only about keeping the price of a pint affordable in British pubs but helping an industry which has been in overall decline continue on its long road to recovery.

“Keeping the price of a pint affordable is vital for the long-term health of the pub sector and CAMRA would hope this latest vote of confidence in British pubs will go some way to slowing the rate of closures, by encouraging more people to make use of their local this summer.

“No doubt many of CAMRA’s 160,000 members will be raising a glass to the Chancellor this evening to toast another brilliant Budget for British beer drinkers,” said Benner.

Julian Grocock, chief executive of the Society of Independent Brewers (SIBA) said, “SIBA applauds the Chancellor’s decision to take another penny off the pint, following last year’s historic decision to scrap the unpopular escalator. It is good to see that this government believes in providing long-term support for the British brewing and pubs industry.

“SIBA’s Budget submission to the Treasury this year was based on the very positive impact of the 2013 duty cut on the local brewing industry. Our members now feel more confident about the long-term prospects for their breweries, and are investing in them by buying new equipment, recruiting new staff or opening new pubs,” he said.

“This evidence of an industry buoyed by the duty cut, which we presented to government both centrally and locally, through our members’ lobbying of their MPs, is one reason why we have been given what we asked for in this Budget – the ‘same again, please, George’. We promise to return the Chancellor’s positive response by giving back more of the same from Britain’s local brewers: more investment in breweries, jobs and pubs.

“It is particularly pleasing that, while duty concessions were given to other drinks, only beer, as our national drink, was rewarded with an actual cut in duty,” said Grocock.

National Association of Cider Makers (NACM) chairman, Paul Bartlett, said: “It is great news that the Chancellor has abandoned the duty escalator and frozen duty on cider this year in recognition of the important role that cider makers play in their local, rural communities as well as the impact on growers and cider makers from the winter storms and rain.

“This common sense decision will be celebrated by nearly 500 producers across the country as it protects the investment they have made over many years to grow the industry and support the rural community – as well as supporting thousands of jobs.

“As the investment cycle for our industry is measured in decades, we have a critical need for stability on duty and policy and we hope this decision signals a period of sustained support from Government for a great British success story.”

“UK cider makers account for over half of all cider produced in the world and British businesses are very active seeking to grow export markets, so this might present a terrific opportunity for producers and the UK economy,” said Bartlett.

Wine & Spirit Trade Association chief executive Miles Beale said: “The Chancellor’s decision to scrap the alcohol duty escalator a year early and freeze alcohol duty for spirits is fantastic news and will be widely welcomed by consumers and businesses.

“The move will help British pubs, bars, and restaurants up and down the country, and will boost jobs and investment in the great British drinks industry and in the hospitality sector more widely.

“While we would have liked to have seen a complete freeze on wine duty, this is a positive step and as such the WSTA applauds the Chancellor’s decision to scrap the escalator,” said Beale.

Duty changes:

Duty on a 750ml bottle of wine is now £2.05p, up by 5p

Duty on a 750ml bottle of sparkling wine is £2.63, up 7p

Duty on a 70cl bottle of vodka at 37.5% remains at £7.41p

Duty on a litre bottle of vodka at 37.5% remains at £10.58p

Duty on a 70cl bottle of Gin at 40% remains at £7.90p

Duty on a litre bottle of Gin at 40% remains at £11.29p

(Source: WSTA)

The revised rates are due to come into effect at midnight, Sunday March 23. The rate of inflation is 2.47%. This is calculated by using the RPI estimate for September 2014 provided by the Office of Budget Responsibility.

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