Drinks industry campaigners are celebrating the scrapping of the alcohol duty escalator in this year’s Budget.
The chancellor George Osborne confirmed today the escalator would be ditched for all alcohol duties, to be replaced by a freeze on spirits and cider, and a 1p cut on beer.
Wine duty will rise by inflation, as defined by RPI – putting around 6p on a bottle.
In his speech to the House of Commons, Osborne described Scottish whisky as “a huge British success story” and said measures today would support the industry. He added that a freeze in duty on ordinary cider would help cider makers in the West Country who had been hit by the recent floods.
“I will be raising a cold pint to the chancellor tonight”
David Forde, Heineken
The Wine and Spirit Trade Association, which had been actively campaigning against duty rises as part of the Call Time on Duty group, said the freeze on spirits duty would 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,” said WSTA boss Miles Beale.
“While we would have liked to have seen a complete freeze on wine duty, the WSTA and our Call Time on Duty campaign partners applaud the chancellor’s decision to scrap the escalator and will be raising a toast to George Osborne.”
Andrew Cowan, country director at Diageo Great Britain, said the Budget would give a boost to “one of Britain’s most successful industries”.
“From Scotch whisky to London Gin, British spirits are admired and enjoyed around the world. In freeing the industry from a debilitating tax policy the government has given a show of support for these quality products. That will benefit the industry not just at home but also help us as we fly the flag for British business across the world.”
Paul Bartlett, chair of the National Association of Cider Makers (NACM), said the move on cider was ”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”.
The Society of Independent Brewers (SIBA) said it was pleased that beer, as the “national drink” had been rewarded with an actual cut in duty. “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,” said SIBA chief executive Julian Grocock.
“I will be raising a cold pint to the chancellor tonight; his announcement on cider and beer duty will be cheered at breweries, pubs, bars and living rooms across the UK,” added Heineken’s UK managing director David Forde.
ACS chief executive James Lowman welcomed the measures on alcohol duty but warned that local shops were still under pressure from the illegal market. ”There remains a significant illegal market in alcohol products, and we will continue to press for more focus on catching illegal sellers and tougher penalties once they are caught.”
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