Why the Alcohol Duty Escalator needs to be scrapped

The British alcohol industry is a shining example of a great British success story. From distillers of Scotch whisky, to producers of London gin and of course our British beer brewers, the UK is home to many of the world’s leading drinks brands.

Hundreds of years of innovation have helped to build an industry which now supports close to 2 million jobs and contributes billions of pounds of revenue to the Treasury each year. The drinks industry is wonderfully supported by our pub industry, which is a central hub in so many of our local communities like my own local, the Bathurst Arms in North Cerney, which helps to employ many young people.

Crucial role​

A crucial role of Government is to support successful industries - to foster the conditions that allow industry to create more jobs, to start new businesses and to drive exports. Industry, particularly the small and medium sized business sector, is the engine of the economy and the success of British businesses is crucial as we look to economic recovery in the years ahead.

This is why the time has come for the Government to end the Alcohol Duty Escalator, which increases the amount of duty levied on wine and spirits by 2% above inflation each year. Until last year the same policy applied to beer.

Pub helped​

The Government rightly recognised that removing beer from the duty escalator would not just help beer producers but also related industries like pubs - as well as providing a small boost for hardworking people faced with the cost of rising living standards.

In this year’s Budget, the Chancellor needs to follow his own logic by removing all alcohol from the duty escalator and freezing duty levels for the coming year.

Nature of pubs​

To more effectively support the struggling pub industry the Chancellor needs to recognise that the nature of pubs is changing. More than 40% of the value of drinks sold in pubs, bars and restaurants now comes from wine and spirits’ sales. Maintaining the escalator will put added pressure not just on pubs but also restaurants, bars and hotels. In the last year alone, the escalator cost them £34m.

While the aim of the Alcohol Duty Escalator is to raise revenue, independent research from Ernst & Young has revealed that scrapping the escalator in 2014 would actually result in a net gain of £230 million to public finances. Moreover getting rid of it in this year’s Budget would also result in 6,000 new jobs being created.

How can a Government support a policy that actively prevents thousands of jobs being created? I do not believe that it can. Put simply, leaving the escalator in place would be bad for the consumer, bad for the economy and bad for business. It needs to go.

Ordinary people​

Finally it is important to remember that the cost of the Alcohol Duty Escalator is borne by ordinary people.

Hardworking people who want to enjoy a gin and tonic, a glass of wine with their dinner or a pint of beer with friends should not be punished.

I know that many of my constituents are struggling with the rising cost of living and they should not be the target of an indiscriminate, punitive tax policy which sees more than three quarters of what they pay for an average priced bottle of spirits and more than half of what they pay for an average priced bottle of wine go to the Government in tax. That cannot be fair.

These are the reasons why I am supporting the Call Time On Duty campaign​. Please make your voice heard and email your MP at and spread the word. Be fair George!