Trade hits out at tax hikes

Trade groups have slammed Alistair Darling's announcement today that he will raise alcohol tax eight per cent to cover a drop in VAT.

Mark Hastings, British Beer & Pub Association, director of communications, said: "It's truly staggering that struggling community pubs and brewers have been denied the tax benefit extended to the rest of the business sector through the VAT cut.

"With pubs closing at record rates and beer sales at their lowest since the Great Depression, this sector needs a fiscal stimulus just as much as the rest of the economy.

"The decision to increase tax further now, plus the looming escalator in March will significantly increase pressures on the community pub.

"There is genuine dismay and disbelief that the Chancellor is turning a deaf ear and a blind eye to the economic plight of Britain's traditional beer and pub sector.

In his pre-Budget speech the Chancellor cut VAT from 17.5 per cent to 15 per cent but ensured pubs and brewers will receive no benefit by raising alcohol duty.

Mike Benner, chief executive of the Campaign for Real Ale, said: "The Chancellor's refusal to allow beer drinkers to benefit from a VAT reduction means that 7,500 pubs could close by the end of 2012.

"The Government's failure to support pubs will undermine community life, ruin livelihoods and deprive people of an affordable night out at a local pub."

Jeremy Beadles, chief executive of the Wine and Spirit Trade Association, said: "The Chancellor has given consumers no cause to celebrate this Christmas.

"This year he will have increased tax on alcohol by a massive 17 per cent, hurting consumers when they have little else to cheer about. It's the wrong tax rise at the wrong time."

Andy Wood, managing director of Suffolk brewer Adnams, said: "It's another attack on the industry that we could do without in the run-up to Christmas - especially as the rise was so hidden."