Chancellor urged to increase draught relief to 20%
Launched on Wednesday 24 January by the Society of Independent Brewers (SIBA), the Campaign for Real Ale (CAMRA) and the Family Brewers of Britain (IFBB), the initiative calls for the lower rate of duty for draught beer to be increased from 9.2% to 20% and a freeze to the rest of the alcohol duty levels.
The trade bodies have jointly written to Chancellor Jeremy Hunt to make the case ahead of the Spring Budget on 6 March, when a decision if expected to be made on beer duty levels from the summer.
SIBA Chief Executive Andy Slee said: “Pubs and breweries already pay way over their fair share of tax and this is the Chancellor’s opportunity to give the sector a boost in his Budget in March.
Major milestone
“Increasing the Draught Relief would mark a major milestone coming one year after the new alcohol duty system went live, which gave the Chancellor the unprecedented power to charge a lower rate of duty on draught beer.”
The letter detailed trading conditions have remained “challenging”, with hundreds of pubs and 60 breweries lost the last 12-months due to the “devastating impact” of the pandemic along with inflationary pressures and rising costs at a time when consumers are reducing their spending.
CAMRA Chairman Nik Antona said: “The support of pub goers and beer consumers was key to getting Draught Relief introduced last year, which enables the Chancellor to favour our cherished pubs and independent breweries in the tax system.
“This is the opportunity for the Chancellor to demonstrate his support and Make it 20% by increasing the Draught Relief in his Budget speech.”
This comes as figures from Oxford Partnership estimated a beer duty reduction of 5% could help create up to 13,000 jobs across the sector.
Welcome development
In addition, recent analysis of data from the Office for National Statistics (ONS) by the Morning Advertiser revealed the cost of a pint of draught lager had increased 10% in the year to December 2023, attributed to ongoing economic headwinds.
The Chair of the IFBB Rick Bailey commented: “The whole sector has seen the benefits of the new Draught Relief, which positively supports our community pubs and independent breweries.
“At a time when the industry is still recovering from the pandemic and trading conditions continue to remain challenging, increasing Draught Relief to 20% would be a welcome development for pubs this summer.”
