Chancellor Gordon Brown has announced a 1p increase in duty on beer and a 4p rise on wine.
Despite calls from the BBPA and CAMRA for a freeze on beer duty the chancellor slapped a 1p tax increase on a pint.
He did freeze duty on cider, whisky, British sparkling wine and spirits.
Delivering his tenth budget today Brown also joked he was freezing duty on Champagne - in anticipation of England's World Cup win this summer!
There was even more bad news for smokers as Brown increased tax on a packet of smokes by 9pence - for a 40-a-day smoker the increase will cost £1.26 a week.
Increases are due to come into effect from midnight Sunday, March 26.
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YOUR COMMENTSGary Marshall licensee of the Blisland Inn, Blisland, Cornwall.
"It is unfair. A freeze on champagne; big deal! How many people in the street drink champagne?"
INDUSTRY COMMENTCAMRAThe Campaign for Real Ale has slammed the Chancellor's decision to freeze champagne duty while increasing beer duty saying it is a slap in the face for Britain's beer drinkers.
The 80,000 member strong consumer group had called for a freeze or a decrease in excise duty in order to reduce the gap between excise duty in the UK and the rest of Europe, enhance the viability of community pubs, and remove some of the profit from overseas alcohol smuggling.
CAMRA Chief Executive Mike Benner said: "This increase is a blow to pubs and consumers. We have seen that even a small increase in excise duty translates into a disproportionate cost for the consumer.
"Such high costs increase the risk that people will no longer visit the pub as frequently, therefore putting the viability of community pubs at risk and threatening the livelihood of hard-working licensees."
"This move will weaken the economy and leave the UK open to a flood of cheap drink being brought in by cross-channel smugglers."
"Given that beer is our traditional drink and the World Cup is being held in Germany, it's outrageous that the Chancellor has frozen duty on champagne. I hope millions of English drinkers can look forward to toasting England's success in the summer with a good pint of British real ale - not champagne."
CAMRA welcomed the freeze on cider duty which it said will help support Britain's 150 small independent cider and perry producers.British Beer and Pub Association"Gordon Brown's decision to raise beer duty is a missed opportunity to create a clear, long-term strategy for beer taxes and correct a long-standing tax distortion between beer and wine, according to the British Beer and Pub Association.
"The Chancellor's inconsistency is shown in his decision to freeze tax on spirits and cider," said Mark Hastings, Director of Communications at the British Beer and Pub Association. "It seems curious that the strongest alcoholic drinks, such as spirits and wine, have enjoyed consistently better tax treatment than beer, which has suffered a 22 per cent tax hike since 1997.
"Rather than the annual Budget merry-go-round, what business needs is a clear strategy for beer duty that delivers the stability we need for planning. Instability, uncertainty and pressures on the sector have cost 1000 jobs in the brewing industry over the last 12 months.
"The Government's unequal treatment of the beer and wine taxes is now costing the Treasury an estimated £200 million a year. Stronger beer is taxed more than weaker beer, but stronger wine is taxed the same as weaker wine. Consequently, because wine has increased significantly in strength it is now taxed less relative to beer. All we are looking for is a level playing field and a tax regime that doesn't favour imported wine over British Beer.
"The Chancellor is now facing the law of diminishing returns. The irony is the more he puts up beer taxes, the less he actually gets back because sales fall, creating a black hole in Government revenues. The Chancellor has everything to gain by pursuing policies that minimise distortions and build stability."
The Scotch Whisky Association"A move that will be warmly welcomed by distillers and supports the Scotch Whisky industry at home and abroad" was The Scotch Whisky Association's (SWA) reaction to the Chancellor's announcement that duty on Scotch Whisky and other spirits would be frozen.
Welcoming today's announcement, Gavin Hewitt, Chief Executive of the SWA, said:
"The Chancellor will be praised by distillers for taking another welcome step towards delivering a fairer alcohol duty regime in the UK. Today he has again narrowed the duty gap within the alcoholic drinks market, a progressive move supporting our industry's competitiveness and productivity.
"A fairer alcohol duty regime helps support a key British industry in its home market and sends a message of tax fairness overseas, as distillers look to develop new opportunities in emerging markets such as China and India."
Sharon Donald (Derby) via email 22/03/2006I see in today's budget Gordon Brown has raised the cost of cigarettes again, what's new you might say - well dear Gordon is at the same time complaining about the lost revenue from ciggies because apparently so many fags are being smuggled in to the country, but wait a minute Gordon voted for a complete smoking ban. What a cheek - he wants the revenue but at the same time dosent want you to smoke in pubs. With the new reform bill looming, ID Cards that are no longer voluntary and the banning of smoking a cigarette which is quite legal I am definitely convinced we are heading into a dictatorship. As he is going to spend 8.5 billion on schools you could say this has been paid for by smokers who contribute an extra 9 billion into the treasury coffers. Of course he wants us all to die of pneumonia standing outside the pub for a ciggie he then won't have to pay us a pension either. When will the rest of the country wake up to what is happening under this government?
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