West Yorkshire pubs and bars warn of price rises as alcohol tax changes
Drinkers face significant price hikes from Tuesday when tax increases will see the duty on a bottle of wine rise by as much as 20%
Drinkers face significant price hikes from Tuesday when tax increases will see the duty on a bottle of wine rise by as much as 20%.
First set out by then chancellor Rishi Sunak in 2021, the new system aims to encourage consumers to cut back by taxing all alcohol based on its strength, rather than the previous categories of wine, beer, spirits, and ciders.
Mr Sunak described the overhaul as "the most radical simplification of alcohol duties for over 140 years", enabled by Britain's exit from the EU.
At March's Budget, Chancellor Jeremy Hunt also announced that the freeze to alcohol duty would end on August 1 and increase by inflation, at 10.1%.
The increase will see duty rise by 44p on a bottle of wine, which when combined with VAT will mean consumers will pay an extra 53p, according to the Wine and Spirit Trade Association (WSTA).
The Chancellor is cutting the duty charged on draught pints across the UK by 11p in August in a major boost for pubs and draught beer drinkers.
However the British Beer and Pub Association (BBPA) said brewers will pay 10.1% more tax on bottles and cans of beer from Tuesday, meaning tax will make up around 30% of the cost of a 500ml bottle.
Graham Phillips is the Head Brewer and Director at Meanwood Brewery in Leeds, he tells us: "Really at the higher ABV range you're going to see a massive increase, so, 8.5% and above, you're looking at an increase of about 56% in price of duty, which means a pint is going to be significantly more expensive".
Scotch Whisky Association director of strategy Graeme Littlejohn said: "The 10.1% duty increase is a hammer blow for distillers and consumers.
"At a time when inflation has only just started to creep downwards, this tax increase will continue to fuel inflation and make it more difficult for the Scotch Whisky industry to invest in growth and job creation in Scotland and across the UK supply chain.
"Rather than choosing to back an industry which the UK government promised to support through the tax system, the Government has chosen to impose the largest duty increase in almost half a century, increasing the cost of every bottle of Scotch Whisky sold in the UK by almost a pound and taking the tax burden on the average priced bottle to 75%.
"In a further blow, distillers will now face a further competitive disadvantage in pubs, restaurants and bars by being unfairly excluded from tax breaks available to beer and cider.
"Pubs and other on-trade businesses are about far more than beer and cider."