Pubs and brewers have welcomed the news the proposed rise in alcohol duty has been pushed back six months but warn that further support is needed for the sector.
Duties were set to increase on 1 February, but the Chancellor will delay the move until 1 August.
Alcohol duty had been due to rise by RPI inflation, which would have seen the price of a pint of beer rise by around seven pence, with a bottle of wine increasing by 38p and a bottle of spirits seeing a £1.30 increase.
Kevin Georgel, chief executive, St Austell Brewery, told MCA that given the significant headwinds the business has faced this year – “external factors outside of our control - from doubling energy costs and cost inflation across our supply chain - have been further compounded by a labour crisis and low visitor numbers in the South West” – it welcomes the Chancellor’s decision to extend the freeze on beer duty.”
“However, the government’s intervention on beer duty must now lead to the permanent reform of our unfair, punitive, and outdated tax regime. It no longer reflects the reality of the modern economy and places too great a burden on traditional businesses such as ours. In the UK, we pay the highest beer duty in Europe,” he said.
“Our industry needs a level playing field and a lighter touch on unnecessary regulation, to see us through the challenges of our current trading environment.
“Pubs and breweries have stood at the heart of our communities for centuries. Now, more than ever, we need certainty and investment in our industry, which has the potential to play a big role in levelling up every single part of the UK.”
Chris Jowsey, CEO of Admiral Taverns, told MCA: “We welcome the chancellor’s move to extend the freeze on beer duty which will help pubs to keep costs down, and ensure that a visit to the pub remains an affordable treat for communities up and down the country. This contribution by the Government demonstrates their understanding of just how important pubs are to their communities, and has come at a good time, given the significantly increasing costs publicans are facing, through energy, fuel and food rises.
”We are grateful for this, but on its own the freeze will not keep pubs going for the long-term. We would urge the Government to continue supporting the sector, and all our brilliant entrepreneurs and pubs, by increasing the energy support at the end of March to ensure our pubs remain the heart of their communities, supporting locals for many years to come.”
James Baer, managing director, Amber Taverns, told MCA that decision by the Chancellor was obviously good news and helpful to it as a business as its hard-pressed customers.
“Of course our industry faces challenges but this is welcome news and will make a difference.
He added: “While Eat Out to Help Out received criticism in certain quarters it demonstrated a recognition of the importance of hospitality businesses to the communities they serve and indeed the wider economy, this duty freeze underlines that Rishi gets it and is still supportive of our industry.”
Nick Mackenzie, chief executive of Greene King, said: “The Chancellor’s decision to extend the freeze on alcohol duty is great news for the industry and recognises the vital role that pubs play at the heart of communities.
“This announcement is welcome and will do much to support our pubs and tenants through a challenging winter as the sector continues to face severe cost pressures. However, we urge the Government to keep its promise to modernise the alcohol duty system so it is fairer for pubs and supports lower-strength products. Fundamental reform is long overdue and will open up investment in the sector, enabling pubs to continue to support communities up and down the country.”
Emma McClarkin, chief executive of the British Beer and Pub Association commented: “The decision to extend the freeze on beer duty will be welcomed by pubs and brewers alike. In 2022 our industry has faced pressures and challenges like never before.
“This freeze will allow £180million to be reinvested into our sector at a critical moment and inject a much-needed flurry of festive cheer for pubs and breweries. It shows the government understands just how much our pubs and brewers mean to communities across the UK.”
But Michael Kill, chief executive, Night Time Industries Association, said while it welcomes the freeze in duties till August, we “urge the Government to recognise the full extent of the problem, and consider further support in the coming months for many businesses to survive”.
“The alcohol duty freeze will give businesses some breathing space but will not repair the damage already done or solve the immediate challenges faced by the sector following three years of disruption.”
