· The Government have announced the alcohol duty freeze will be extended for a further six months, providing certainty to the alcohol sector.
· As part of the Government’s responsible management of the UK economy, the extension of the freeze aims to reassure pubs, breweries and distilleries who are facing tough challenges ahead.
· The end date of the freeze aligns with a new simpler alcohol tax system and reserves the Chancellor’s decision on future duty rates for the Spring Budget 2023.
Henry Smith MP has welcomed the Government’s decision to extend the alcohol duty freeze for a further six months, helping pubs in Crawley.
Henry said;
“As the hospitality sector recovers from the pandemic and faces higher energy prices, it’s right we stand by our pubs, distilleries and breweries.
That’s why I welcome the announcement from Government that alcohol duty will be frozen for a further six months, as part of a larger commitment to radically simplify the tax system and slash red tape.
“This action will give pubs, breweries and industry representatives more time to get ready for the new, alcohol tax system due to come in next year.”
The current alcohol duty freeze was announced at Autumn Budget 2021, saving consumers over £3 billion over five years. It was expected to come to an end on 1st February 2023 but this action extends the relief and gives the alcohol sector more time to prepare for the new, simpler alcohol tax system due to come in next year.
The new alcohol tax system will adopt a common-sense approach, where the higher a drink’s strength the higher the duty, whilst new reliefs will be made available to help pubs and breweries thrive.
New Draught Relief will be worth £100 million a year and will ensure smaller craft producers can benefit, the threshold for qualifying containers will be 20 litres.
Small Brewers Relief will be renamed Small Producer Relief, reformed and expanded, meaning that all producers that make drinks below 8.5 per cent – mostly craft brewers and cidermakers – will be able to get relief on their products.
The wine industry will also be supported as they adapt to the new system. All wine between 11.5 and 14.5 per cent alcohol by volume (ABV) to calculate duty as if it were 12.5 per cent ABV for 18 months from the implementation of the new system.
The Exchequer Secretary to the Treasury, James Cartlidge, commented;
“Today’s announcement reflects this Government’s commitment to responsible management of the UK economy.
“The alcohol sector is vital to our great country’s social fabric, and we have listened to pubs, breweries and industry reps concerned about their future as they get ready for the new, simpler, alcohol tax system coming in, which is why we have acted now and with decisiveness.”
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