Alcohol tax frozen in attempt to mitigate price hikes


The move comes weeks after data company CGA warned that pint prices could rise to £8.50 next year.

They have risen by more than 70 per cent since the financial crisis, to an average of £3.95 last year. Pints ​​sold for an average of £8.06 in a London pub this summer.

Jenny Hanlon, chief financial officer at leading brewer Adnams, welcomed the Chancellor’s support, saying: “It is encouraging that the government is listening and acting on the challenges we and others face.”

Wine bosses labeled the move a “sensible”.

Smaller breweries, meanwhile, received a boost after Kwasi Kwarteng said separate changes to reduce excise tax on draft beer and cider would also apply to smaller kegs, amid concerns it would unfairly benefit larger companies.

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The strain relief, which previously only applied to large barrels, will come from August next year.

Nik Antona, president of the Campaign for Real Ale, said the latest change means “smaller breweries, cider producers and pubs can all benefit”.

“The announcement that the new excise tax rate on draft beer and cider will come into effect from August 2023 is fantastic news for their great UK local as the tax system will recognize that beer, cider and perry must be served in a pub or social club taxed at a lower rate than alcohol purchased in supermarkets.”

Emma McClarkin, chief executive of the British Beer and Pub Association also welcomed the news, saying: “We welcome the steps taken by the government in the Chancellor’s tax statement. The measures announced today will provide a £500m boost to our industry, enabling growth after successive crises and enabling us to thrive in the future.”

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The Treasury also published consultation papers on all the alcohol tax changes, in which officials signaled that prices for alco-pops could also benefit.

They suggested that “ready-to-drink” draft-based products would receive the planned draft relief if their ABV was below 8.5 pc, after noting that there was a “small but growing market” for these drinks. .

While Mr Kwarteng’s policy announcements were welcomed by the brewers, the pub chefs were less optimistic. Kate Nicholls, chief executive of UKHospitality, which represents pubs and restaurants, said there were some “welcome” updates to the mini-Budget, including the alcohol tax freeze though noted alcohol levy was more of a “production tax”.

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She said: “There is certainly a lot to welcome in the direction of the government’s journey in terms of tax cut targets. However, many companies in our industry are still looking for survival, and there was little there that offered direct meaningful support.” offers in the short term.”

Hospitality bosses had pushed for bigger changes to VAT and business rates, with Steve Alton, chief executive of the British Institute of Innkeeping, saying: “Just without further support, many pubs will fail.”



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