Marketing

‘Sin taxes’ rise again in the UK

Yesterday’s UK Budget 2012 once again raised ‘sin taxes’, taxes on alcohol and tobacco when Chancellor George Osborne increased the tax on alcohol by 5.4 per cent (comprising a two per cent increase on the inflation figure of 3.4 per cent, thus continuing the UK Government’s ‘above inflation’ duty escalator) and that on a pack of cigarettes up by 37 pence.

The Budget will lead to a four per cent increase in the price of alcohol for the consumer with wine now likely to hit an average of £5 a bottle and the price of a pint likely to settle at an average £3.17.

The Budget developments mean that the cost of beer in the UK will have risen by 42 per cent since 2008.
Reaction to the Budget has been predictable from the UK drinks industry with Wetherspoon pub chain Chairman Tim Martin pointing out that Britain now pays 40 per cent of all alcohol duties in Europe – this despite the fact that it consumes only 13 per cent of all beer sold in Europe.

The UK taxman now takes one third of every pint sold in Britain.

The British Beer & Pub Association’s Chief Executive Brigid Simmonds commented, “Since 2004, the tax on beer has risen by 60 per cent, but tax revenues have fallen far short, with only a 10 per cent rise in duty revenues despite the huge toll in lost jobs and pubs and lost revenue through VAT as beer sales have fallen by 25 per cent.

“It beggars belief that further hikes are planned next year. The Government must rethink this damaging policy before even more harm is done to the British brewing and the pub trade.”

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