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Chancellor Hammond: broad-based support on both sides of the aisle for a freeze on beer and cider duties

 

 

Chancellor announces review of beer duty relief

To the delight of the industry, Chancellor Phillip Hammond’s autumn Budget has frozen beer duty for the coming year – but the news of potentially greatest consequence was a single line buried in the Red Book: small brewers duty relief is to be reviewed.

It’ll be only the second time that sliding scale duty will have been reviewed since its introduction in 2002, with the first and only prior consideration of its merits having taken place shortly after its introduction, in 2004. 

All that’s known at this time is that the government intends to consider duty relief “to ensure that it is supporting gowth in the sector.” It’s a starting point that evidently will require fleshing out, especially in regard as to how ‘’growth’ is defined. 

The relevant brewing industry associations have welcomed the review. SIBA chief executive Mike Benner promised that his organisation would be actively engaged with the Treasury. 

“SIBA, as the voice of British Independent brewing will be front and centre in working with Treasury to usher in the next chapter of SBR.,” said Benner. “We will ensure the smallest breweries are protected, growth is incentivised and the sustainability of UK brewing is the centrepiece of reform.”

Rupert Thompson, co-chair of the Small Brewers Duty Reform Coalition, said  "The much overdue review of the Small Brewers Relief is an opportunity for the Treasury to ensure that this important relief is re-shaped so that it always supports growth.  This is a very exciting opportunity to revitalise the small brewing sector and cask ale in particular."

British Beer & Pub Association Brigid Simmons described news of the review as “most welcome.” 

As for the freeze on beer duty for the coming year, in his speech to the House Chancellor Hammond indicated broad-based political support for the action. 

“I have received numerous representations from my Honourable and Right Honourable friends on one particular subject and in response I will be freezing beer and cider duty for the next year, keeping the cost of beer down for patrons of the great British pub.”

Hammond also froze duty for spirits, while allowing duty on wine to increase by the Retail Price Index. A new duty band for still cider and perry, from 6.9% to 7.5% abv, to target white ciders is to be introduced a rate of £50.71 per hectolitre and will apply from 1st February 2019.

The Campaign for Real Ale welcomed the announcement but reiterated a recently added campaigning objective, the introduction of a preferential rate of duty for draught beer. It’s a measure that would benefit the nation’s pubs, which CAMRA notes continue to close at a rate of 19 a week. 

CAMRA has planned a mass lobbying effort for the day after the Budget announcement, 30th October, where hundreds of members are visiting Parliament to press their MPs for action not only on beer duty but also for a review of the Pub Code so that the Market Rent Only option becomes a viable opportunity for tenants. 

Larry Nelson
30h October 2018

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