The BBPA’s members account for 96% of the beer brewed in the UK and about half of its pubs.
According to the BBPA, the overall beer sales decline of 6.2% in Q4 2012 shows the pressing need for a review of the Government’s controversial ‘tax escalator’ on alcohol there which is not due to run out until 2014/15.
The ‘damaging’ above inflation tax hikes on UK beer meant that 138 million pints fewer were sunk in the last three months of 2012 compared to the same period in 2011 thus hitting Government revenues too, argues the BBPA which adds, “An analysis from Oxford Economics indicates that a duty freeze in March [UK Budget time] would save 5,000 jobs in the sector this year, which employs almost 1 million people – mostly younger people in Britain’s pubs”.
The study for the BBPA by Oxford Economics shows that the 5% tax rise in the Budget will result in only £92 million in extra beer duty revenues which will almost be offset by the loss of employment and other taxes (and an increase in social security spending) resulting from the 5,000 jobs the sector will lose as a result.
Despite the pressure from MPs voting for a review of the escalator and a petition signed by over 100,000 calling for government to drop the duty tax escalator, The Treasury has refused to budge.
Chief Executive of the British Beer & Pub Association Brigid Simmonds OBE commented, “These figures show that the Government needs to stop its full-on tax assault on our vital beer and pub industry. We’ve had tax hikes of 42 per cent since March 2008 which is hugely damaging and completely unacceptable for such an important manufacturing sector. Instead, we could be protecting and creating jobs at a time when the country most needs it.”