While the beer tax escalator was scrapped in 2013, the Treasury has built in an inflation increase for beer, which has prompted renewed efforts to urge the Chancellor to cut the duty.
Independent family business Joseph Holt is the latest to back calls for a tax cut as the British Beer and Pub Association (BBPA) ramps up its campaign.
Tax on a pint of beer is currently 52p and the BBPA would like to see this cut by 2%, which is equivalent to about 1p off a pint. Campaigners also argue that the UK’s current level of tax is high in comparison to other EU countries such as Germany, France and Spain.
Cut duty to save jobs
The BBPA estimates that a 1p cut will save beer drinkers £32.7m annually and will preserve about 1,000 jobs.
Concerns about the duty have grown as Prime Minister Theresa May prepares to trigger Article 50 next month to start the process of leaving the EU.
Earlier this month, Joseph Holt chief executive Richard Kershaw, who also chairs the North West Beer and Pub Association, joined the BBPA in hosting a parliamentary reception at Westminster to urge MPs to support the tax cut.
Kershaw said: “Three duty cuts and a duty freeze over the last four years have enabled us at Joseph Holt to substantially increase our investment in our 126 pubs, on which we spent £6.5m last year and saw our beer volumes increase for the first time for several years.
"For 2017 we would anticipate that a beer duty cut would enable us to proceed with our investment plans to spend a further £4.3m on our pubs, as well as investing a further £2.5m on five pubs we have recently acquired, which in total would create another 110 full time jobs for us.
"The duty cuts and freeze has also meant that innovation in our beer brands has been given greater emphasis in our business at Holts. We have proudly brewed award winning beers since 1849 but our Brewers have recognised the need for Capex investment in this new market. We have developed new lagers, an American IPA in Keg and bought a 3brl brewery which we use as our pilot plant for developing new beers.”
The brewer has also announced that its Two Hoots Golden Ale is now on sale at the House of Commons bars.