Reports in the Financial Times estimate that Heineken is set to save £6.6m in duty per year from the move, which coincides with an increase in wholesale prices for the beer of 2.5p per pint that was announced last week.
The brewer has defended its decision however, telling the PMA that it will pass on part of the duty savings to pubs and clubs in the shape of lower wholesale price increases – its Foster’s brand for example is set to increase by 5p a pint wholesale at the same time.
The remainder of savings will be reinvested in into the brewing and marketing the brand, it said.
“The move to 3.6% ABV is designed to bring John Smith’s Extra Smooth in line with competitor smooth ales that already sit at or below this alcoholic strength,” said a spokesman.
“Extensive research conducted with John Smith’s retailers and consumers consistently confirmed that a 0.2% reduction in ABV does not compromise on the taste and quality that has made the brand the UK’s most popular ale and we are confident that John Smith’s Extra Smooth will continue to lead the ale category going forward.”
It blamed the rising costs of energy and ingredients as well as rising beer duty for the move but confirmed that John Smith’s cask conditioned bitter will stay at 3.8% ABV.