Draught relief and duty increases announced at the Spring Budget
During today’s Spring Budget, Chancellor Jeremy Hunt announced an increase in draught relief on pints of beer sold in pubs, but the increase in alcohol duty in line with inflation will still be going ahead.
Speaking in the House of Commons, the Chancellor opened: “I report today on a British economy that is proving the doubters wrong.”
He then claimed that the raft of measures he was about to announce would prevent the UK from entering a technical recession, curb inflation and address the cost of living crisis.
Though topics ranging from nuclear power to potholes were covered, there was key news for the UK’s pubs.
“Today I will do something that was not possible when we were in the EU,” Hunt explained, announcing what he dubbed the “Brexit pubs guarantee”, which promises that, from August, the draught duty on beer in pubs will be up to 11 pence lower than that in supermarkets.
“British ale is warm, but the duty on a pint is frozen,” he quipped.
Due to the recently-agreed Windsor Framework, that change will also apply to Northern Ireland.
Though a rise in alcohol duty in line with inflation was expected ahead of Hunt’s statement, the speech itself did not go into details other than stating what many in the drinks industry feared: “In December, I extended the alcohol duty freeze until 1 August, after which duties will go up in line with inflation in the usual way.”
The published version of the Spring Budget confirms: “Duty rates of all alcoholic products produced in, or imported into, the UK will increase in line with RPI [Retail Price Index]. Draught Relief will increase from 5% to 9.2% for beer and cider draught products and from 20% to 23% for wine, spirits based and other fermented draught products. These changes will take effect from 1 August 2023.”