Chancellor John Healey Raises Alcohol Duty by 3.9 Percent
Chancellor John Healey increased alcohol duty in line with inflation while providing 10 million pounds in tax relief for small brewers.
Chancellor of the Exchequer John Healey announced an increase in alcohol duty effective February 1, raising the tax in line with the Retail Prices Index inflation rate of 3.9 percent. The measure adds approximately 2p to a pint of beer, 10p to 12p to a bottle of wine, and 35p to a bottle of spirits. To offset the impact on smaller producers, the government is providing 10 million pounds in alcohol duty tax relief for over 2,000 small beer and cider brewers.
The announcement follows days of lobbying from trade bodies that had urged a duty freeze to protect the industry during a cost-of-living crisis. Industry leaders argued that British brewers already face duty rates 12 times higher than those in Germany and Spain. In addition to the tax hike, the government pledged to introduce a Guest Beer provision in the Pubs Code of England and Wales to give tied pub tenants more flexibility in stocking beers.
Hospitality leaders condemned the decision, claiming the hikes stifle business growth and burden consumers. The Wine and Spirit Trade Association and the British Beer and Pub Association warned that the increase threatens employment and the viability of local pubs, arguing that the government should support rather than squeeze the drinks sector.
